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Roundup 1-31-2014

January 31, 2014

Economy – The Housing Market

As usual, there is much news about the economy, including the housing market.  Things are better, but how much?

A new home price forecast by CoreLogic Case-Shiller indicates Tampa will see one of the largest gains in home prices in 2014.

The annual study projected that home prices will rise by 8 percent in the 12 months ending in September 2014, CNN said. That gain makes Tampa the sixth “hottest” housing market in the country, CoreLogic found.

That is positive, but there are some caveats.

Still, since the area was hit so hard by foreclosures and the housing crisis, buying in Tampa is still a relative bargain. The median home price in the area is $177,000 compared to the national median price of $207,000, CNN said.

Inexpensive housing is good for buyers but starting at a very low point means each percent of increase is not very much compared to other areas. Then there is this:

More than a quarter of homes sales in December in 10 of the country’s largest metro areas were processed as either foreclosures or short sales, a new report says. Tampa ranked fourth, with such transactions making up 30.1 percent of home sales.

So there is improvement (and people still are moving here), but we still have a way to go.  The key is to create demand by developing a diverse economy.

Economic Development – We’re Talking the Talk, but Are We Walking the Walk?

One of the major economic development target areas, and topics of conversation, locally is biotech.  There has been some growth (like Bristol-Myers Squibb), but a recent Tampa Bay Business Journal item provided a much needed reality check.

The lack of critical mass is one barrier to growth for the Tampa Bay biotech sector, industry leaders said.

In communities where biotech is a growth business, such as San Francisco, Boston and the Research Triangle in North Carolina, there are strong clusters of biotech firms, said Dr. Alan List, president and CEO of Moffitt Cancer Center, during a Tampa Bay Business Journal roundtable discussion on the state of biotech.

“You can leave one and go to another … you have so many opportunities right there,” List said. “That’s what attracts the venture capitalists.”

Clusters also attract talent, said John Bonfiglio, president and CEO of Oragenics Inc. (NYSE MKT: OGEN). “They know if one company fails they don’t have to relocate in order to find another company.”

Of course, the cluster/critical mass point does not apply just to biotech, but given all the talk about biotech, it is interesting to note that we have not reached “cluster” status yet.  So what is the issue?

It’s been a slow go building biotech clusters in Florida, according to a new report from two agencies that provide oversight for the state legislature. “Biotechnology cluster development can take many years, and while Florida has the potential for additional growth, it faces challenges,” the report said. “The major challenge to furthering cluster development is fostering an environment that translate discoveries into marketable products.”

Well, there is a massive amount of competition both within the state and from outside the state for biotech facilities and many clusters resulted from a confluence of circumstances that may not exist everywhere that wants to be a cluster.

Anything more Tampa Bay specific?

Marketing and higher visibility are key, said Pat Lawman, co-founder and CEO of Morphogenesis Inc. “There’s a stealth cloak over Tampa Bay.”

Now that is a surprise in its harshness (though it probably was not meant to be harsh).  There has been so much effort to get the Tampa Bay biotech name out there and so much hype about biotech (things like this) that one would think that everyone would know about the Tampa Bay area.  Obviously things take time, but “stealth cloak?”

Maybe we need more regionalism:

One answer may be more proactive outreach between existing companies, said Caroline Popper, co-founder and president, Popper and Co., a strategy and M&A advisory firm in Sarasota. “Drive an hour, take a bigger view of a cluster – maybe more like a spider – the whole I-4 corridor, as opposed to just a 10-minute drive down Sand Hill Road.”

Or mega-regionalism. (It might be good to master regionalism first.)

We are all for development of the biotech sector.  We are also for development of other sectors and the cluster/critical mass argument applies there, too. And regional cooperation, rather than marketing individual areas, is a key to success.  We also tend to think that having successful discoveries and products coming from our area vital.  The fact is that we are just not there with the number of companies and institutions and successes.  Moreover, while the marketing efforts are a start, clearly they need to be refined. (Not to mention the issue of making the area more attractive for talent to live in.)

Frankly, we are happy for the article because 1) it provides a necessary corrective to all the hype, and 2) it shows that people who deal with reality are not “putting down” the area, they are looking after its best interests by noting when the area’s efforts need modification to increase the likelihood of success.

Port – Of Style and Substance

At the recent speech, the Port unveiled a new name:

Cargo is the lifeblood of a port. It’s Tampa Port Authority chief executive officer Paul Anderson’s job to bring more of it to his.

The Port of Tampa unveiled a new brand with a familiar name Wednesday to do just that:

Port Tampa Bay.

* * *

Anderson wants to position Port Tampa Bay as the closest full-service U.S. port to the expanded Panama Canal and the booming economies of Latin America. The new brand was unveiled with a video showing Hillsborough business leaders pitching the bay area to potential clients — but it did not include any Pinellas leaders.

Marketing the Tampa Bay region as a whole is an approach the bay area’s other economic development leaders have taken to heart. When Tampa International Airport CEO Joe Lopano pitches his airport to airlines, he’s selling something even bigger: the 3.5 million people who live within an hour’s drive of the airport, from Hernando to Sarasota counties.

That’s fine (though whether the port is the closest full service port is really a function of facilities and geography, not branding).  Frankly, we do not think rebranding is that big a deal, but if it helps bring more business, great.  How are the rest of the area facilities taking the change?

The name change also reflects a new leadership role that Anderson wants Port Tampa Bay to take with much smaller regional ports like the Port of St. Petersburg and Port Citrus. Neither are cargo ports, but both recently signed agreements to work closely with the Tampa Port Authority. Anderson said his port could provide them with the expertise and help they need if they ever grow their operations.

Port Tampa Bay’s relationship with its nearest competing cargo port, Port Manatee, is a different story. In October, Manatee’s board pre-emptively voted to oppose any potential merger with Tampa. Anderson said Wednesday that he’s committed to working more closely with all nearby ports, including Manatee.

So there is one hold out to working cooperatively.  Nothing new there (except that in this case the holdout is not Hillsborough.)  It would be nice if everyone could take a regional approach, but at least overall there is a step in right direction.

Of course, it all means nothing unless we get positive results:

“It’s a breath of fresh air, it’s a burst of new energy,” port chairman Stephen Swindal said of the new brand. “But now we need to make sure some of these plans come to fruition.”

We are not sure about the fresh air comment, but maybe some business plans will come to fruition.

Discussions are under way with major vehicle manufacturers who are making cars in Mexico to ship them through Port Tampa Bay, the head of an international auto processing company said Thursday at the first day of the two-day Shifting International Trade Routes conference in Tampa.

“Within the next year you will have cars here,” Steven Rand, president and chief executive officer of Jacksonville-based Amports, told a group of about 200 shipping industry officials meeting at the Grand Hyatt Tampa Bay.

Hopefully.

Setting aside Port Manatee because it is part of our region, there is a lot of competition for the Port.  For instance, Port Everglades is building rail lines right up to the ships to get containers right onto rail lines (kind of like the rail line expanded in Tampa in 2012) as well as looking to dredge their channel to permit the biggest ships to use their port (unlike Tampa).

The rebranding is fine, but the results are the key.

TIA – It Seems There Is Demand, Initially At Least

TIA released initial load information for the Copa flights.

According to the airport, 2,108 passengers flew into Tampa on Copa’s planes, filling 2,376 of the available seats. The airport only had numbers for December available.

Strong demand is important because Copa has signed only a one-year deal to fly out of Tampa International Airport. The airport and its economic development and tourism partners have pledged to help fill Copa’s seats to persuade the airline to stay in the Tampa Bay market.

That is positive news. It is just another sign that those people, like the former Aviation Authority board chairman (see here and here), who pushed so hard to get more international service were correct.  (Other signs are success in Cuba flights, expanded British Airways service, and Edelweiss service.)  Let’s hope it lasts and grows further.

We are happy that so many people have joined in supporting the international flight push (the more the merrier), but credit should go where it is due – to the people who stuck their necks out and pushed the issue when it wasn’t popular (and took a lot of crap for it). That is leadership. (It is the people who said/say we could not do something or that we shouldn’t really try, not the people who said/say we should accept neither mediocrity nor failure to reach our potential, who “put this area down.”)

In further airport news, TIA is moving forward with its master plan.  (check the article for renderings)  We fully support that, but more flights, please.

TIA – Regionalism in Action

We ran across an article about a Sarasota promotion for an event this March.

The daredevil act is getting a little hairy here as Visit Sarasota and Sarasota-Bradenton International Airport disagree on whether Tampa’s airport should be with them for a Nik Wallenda promotion in London.

Visit Sarasota is partnering with Tampa International Airport to organize a March reception for tour operators featuring Nik Wallenda in London to get Europeans to come to Sarasota. But Frederick “Rick” Piccolo, president and chief executive officer of SRQ Airport, is protesting the partnership, saying Sarasota should not be taking money from TIA when it also promotes SRQ.

“This is an exclusive Sarasota County event. It is not a regional event,” Piccolo said at Monday’s Sarasota-Manatee Airport Authority meeting. “We fully understand that Tampa International provides a lot of lift to this community as well. It’s a wonderful airport, but we objected to their participation in the event because this is a Sarasota event only.”

Piccolo doesn’t believe there was any malice involved, but he is still disappointed.

Interestingly, it is not Sarasota giving money to TIA, but TIA promoting a Sarasota event.

British Airways is providing some airfare for the promotion, Hayley explained, and during unrelated meetings with Tampa International, staff there heard about the promotion and offered to help with a $10,000 to $15,000 contribution as a sponsor.

It’s the first time the Tampa airport and Visit Sarasota have directly worked with one another on a promotion, she said.

* * *

When working an international event, it’s important for smaller cities to stand out and show the ease of connecting to other destinations, and that’s why using British Airways from London to Tampa is vital, Hayley said.

Even though Sarasota-Bradenton airport does not have flights to London, not all are convinced by TIA’s efforts:

Europeans can also take Delta, U.S. Airways or United flights with a stop in Atlanta, Charlotte or Chicago to get to Sarasota-Bradenton, Piccolo said.

Yes, but then they would have to change planes.

Good for TIA for getting involved and good for Visit Sarasota for accepting the help.  It makes sense and promoted the area.  On the other hand, the complaints are another example of how local rivalries can get in the way of regional progress.

Transportation – Streetcar Insurance

We learned recently that the Streetcar Board is still trying to get out from under CSX’s very expensive insurance requirement.

After paying $4 million over the past decade for insurance to permit the non-profit streetcar to cross a CSX Transportation track that about eight freight and passenger trains use daily, the streetcar board is seeking relief from the state government.

The streetcar board has prepared a resolution requesting the board of the Hillsborough Area Regional Transit Authority to get the Florida Legislature to amend state liability agreements with CSX to include the Tampa streetcar crossing and get the state to cover the costs.

“The Florida Department of Transportation has an agreement with CSX covering liability for passenger services that use or cross CSX facilities for South Florida Regional Transportation Authority (Tri-Rail – West Palm Beach-Miami) and SunRail (Orlando area), and the state is absorbing that cost,” the resolution said.

“Extension of the FDOT/CSX liability insurance agreement to the TECO Line Streetcar System would provide equitable treatment to all geographies in the state regarding cost of liability for using/crossing CSX Facilities.

“This action would lower total liability costs … and enable local resources to be directed to improve service.”

The premium for liability insurance for fiscal 2013 is $430,138, which is 30.2 percent of the streetcar’s annual operating budget.

Exactly. The State covers insurance for CSX on other systems in other areas of the state which have much higher risks.  It should cover the streetcar, which will free up money to make the streetcar more useful and financially sound.  There is no reason CSX should object, and there is no reason the State should object.

It is odd that this move did not happen much sooner (like when the State made the SunRail deal), but at least there is a push for it now.

And, hopefully, there will also be a push to integrate the streetcar more fully in any upcoming Hillsborough County transportation plans.

Transportation – Why Polls Do Not Matter, Especially This Early

The Tribune had an article on a new poll regarding Greenlight Pinellas that was quite interesting.

Commissioned by former St. Petersburg City Council candidate and local neurosurgeon David McKalip, a fierce opponent of the transit plan, the survey found that 45 percent of residents opposed raising sales tax to pay for a “commuter train from St. Petersburg to Clearwater.”

That number rose to 60 percent after respondents were told the extra penny sales tax would give Pinellas County the highest sales tax rate in Florida.

* * *

More than 2,000 residents across the county who voted in both 2010 and 2012 took the telephone survey that was conducted by StPetePolls. The margin of error was 2.1 percent.

A previous survey by the same group in April showed roughly half of voters thought the county needed a light-rail system, but respondents deadlocked on whether they would pay more taxes for it. Other polls have shown stronger support for the Greenlight plan.

Of course the guy who commissioned the poll provided an interpretation of the results:

“It shows that people don’t want their taxes hiked to build transit or to grow a government bureaucracy,” said McKalip, who is a contributor and supporter of No Tax for Tracks, a group opposing the Greenlight plan. “When people are informed this will be the highest sales tax in the state, they don’t want to support Greenlight Pinellas.”

On the other hand:

But transit supporters say the questions written by McKalip were designed to skew the results. The survey fails to mention that the new sales tax will replace a special property tax that funds Pinellas Suncoast Transit Authority operations, they said. It also focuses on the more controversial rail component of the plan and omits that roughly half of the money raised through the new tax is earmarked for a 65 percent expansion of the county’s threadbare bus network.

“The polling results based on those questions is not a surprise,” said Ken Welch, a county commissioner and chair of the PSTA’s governing board. “Our focus will be to give voters the full package of information about what Greenlight Pinellas is about.”

So what does the pollster have to say about his own poll?

StPetePolls owner Matt Florell said the results were likely a combination of residents learning more about the plan and the wording of the survey.

“The questions are very different from ones we’ve asked,” he said. “We’ve only asked ones where we try to be more neutral.” 

That sure sounds like an admission that the questions in the poll were phrased in a way that would skew the result.

In any event, we do not think polls are relevant at this point, except for the hype value.  Those in favor of Greenlight Pinellas should learn from Hillsborough’s 2010 experience, assume it is a tie (or they are losing) and that they need every vote, because they do, and act accordingly.

The only poll that counts is the vote, and right now no one really knows where the voters stand.

Fairgrounds – A Modest Proposal

Recently, details of a proposal for development of the Florida State Fairgrounds came out:

A committee of the Florida State Fair Authority, the board that oversees the fairgrounds, met Wednesday to evaluate Republic Land’s offer to build a sports, hotel and entertainment complex on its grounds. The developer would use 123 of the fairgrounds’ roughly 330 acres, leaving intact the annual fair’s core area, the MidFlorida Credit Union Amphitheater and Cracker Country.

So what does this proposal include?

*GoodSports Village. The anchor tenant would be a new sports-themed hotel and athletic complex operated by Sarasota-based GoodSports Enterprises. GoodSports is an affiliate of longtime hotelier Focus Hotels of Sarasota.

The company would operate a new 200-room GoodSports Hotel catering to business travelers during the week and amateur athletes in town for tournaments over the weekend. Next to the hotel, a 65,000-square foot sports field house would host basketball and volleyball tournaments, said Anthony Homer, a GoodSports Enterprises vice president.

*Water park. Documents provided little information about a proposed water park, other than it would sit on about 17 acres and would have a wake boarding attraction using a cable.

*Virtual golf experience. Republic’s project would include an indoor “virtual golf experience,” developed in conjunction with an unnamed celebrity golfer. The documents don’t shed much light on the idea, but competing virtual golf companies use simulators, which allow golfers to hit balls into a screen that shows fairways and greens of elite golf courses. The idea is to recreate the feel of playing on these courses.

Later phases of construction could include a restaurant park with multiple restaurants; Main Event Bowling, a Dallas-based chain of bowling/laser tag centers and big-box retail.

Our initial reaction is to wonder whether this is the best use for the Fairgrounds, as well as to wonder what the rush to develop the area is.

A few other things we wonder about: Why build a water park when we have Adventure Island? Won’t the golf facility compete with the hype filled Top Golf down the road? Why build a restaurant complex on public land when it can be done on private land nearby? Big box retail? Why, because SR60 and Brandon is so far away?

It is not like the land is going to become less valuable over time.  Most likely, especially given the proximity of the Hard Rock and the County’s desire to develop the area around the I-4/I-75 junction, the land’s value will increase and better uses can be found.  Nevertheless,

The committee gave the company an initial green light on Wednesday and will recommend that the full Fair Authority continue to explore a deal with Republic Land.

There is nothing wrong with exploring an idea, but, as we said, is this really the best use of and the best time to develop the land?  We have our doubts, and we have not seen a justification for making this deal at this time.

Ybor – More Stirrings

This week, the Tribune reported that some private property in Ybor may actually get some development.

An unused Ybor City landmark, the neighborhood’s largest vacant building, could find new life if a proposal now percolating comes together.

The Oliva Tobacco Co.’s warehouse on Palm Avenue has been an Ybor City fixture for more than a century, surviving a fire that destroyed much of the area in 1908.

* * *

The effort now under discussion would rehab the building into a mix of ground-level retail space and loft apartments.

“I can’t speak in great detail about what we’re working on,” said David Hugglestone, the Ybor City-based architect working on the project. “It’s definitely not a concrete plan yet.”

Hugglestone said the potential developers are investors from Miami, but not the same group working on an apartment project on nearby city-owned land.

Hopefully, something will come from it.  Filling in the blanks in Ybor, especially without giving up public property (the value of which will only increase as private development occurs), is a good thing.  It would also be nice to bring this building to life.  Of course, the past should inform the present:

Attempts to redevelop the building in 2008 ran into problems when developers couldn’t create enough parking to meet city requirements for a hotel.

A nearby hotel has a relatively large surface lot.  Hopefully, the City will not require the same here.  Parking is an issue (and the property is not that big), but it is also an urban area with City parking not that far away.  One thing Ybor does not need is more big surface parking lots.

We shall see.

Meanwhile In the Rest of Florida

– Regionalism

We stumbled across an article about South Florida counties working together to develop their region and its economy.  Not surprisingly (because it is obvious), part of the focus is on creating walkable areas and better transit.

Come 2060, a larger share of Southeast Florida residents will live in walkable districts linked to railroads, trolleys, bike rentals and other transport options besides cars.

More diverse, urban housing will let more folks of different ages and incomes live together. And more coastal areas will be protected against sea level rise through such investments as back-flow preventers.

Furthermore, the economy will depend less on serving new arrivals and tourists, with more high-tech jobs and schools better preparing residents for the jobs available in the region.

That’s just a glimpse of the Seven50 plan for seven Southeast Florida counties 50 years from now, a report presented Wednesday after two years of input from business, government and civic leaders

The mayors of Broward, Palm Beach and Miami-Dade counties made a rare, joint appearance at the presentation to celebrate the plan and pledge cooperation on common concerns, especially in areas such as transport that demand massive, regional investments that no single area can make on its own.

Well, the ideas sound familiar, but not the process.  How about this?

“Only when the region speaks in one voice can we be effective in Tallahassee and in Washington, D.C.” to persuade officials to fund major projects for Southeast Florida, Broward County Mayor Barbara Sharief told a crowd of more than 200 people gathered for the presentation at the county’s convention center.

There is no doubt – and, unless things change dramatically here, if South Florida speaks with one voice and Orlando speaks with one voice, the Tampa Bay area will get crushed in money game in Tallahassee.

And this:

If current trends continue, the future for the area would be more traffic jams on roads, more suburban homes encroaching on nature and farmland, plus growing shortages of clean water for residents.

In that scenario, 98 percent of trips still rely on cars, and just 70 percent of households live within one mile of a park. That lifestyle pushes obesity rates past 25 percent, presenting big health risks and costs.

But the outlook brightens with a more mixed-use, walkable areas with new transit links in a scenario dubbed “Region In Motion.” In that case, only 60 percent of trips use cars, 90 percent of households live within one mile of a park, and the region’s obesity rate slips to 17 percent.

What’s more, regional efforts attract more of the “creative class” in high-tech, arts and innovation, with one of three workers in that group and the area rising into the top 50 U.S. creative hubs, the plan said.

Admittedly, a bit ambitious, but why not try? But then there was this:

Yet obtaining funds involves lobbying jointly as a region in state and federal capitals, an area where Southeast Florida long has been weak, according to Seven50 leaders.

“The I-4 corridor [in the Tampa-Orlando area] is kicking our butt, because the 13 counties there are working together,” said Michael Busha, executive director of the three-county Treasure Coast Regional Planning Council and co-director of the Seven50 effort.”They have accepted the fact that they are a region and are behaving that way.”

That kind of confused us.  We don’t remember having the leaders of Pinellas and Hillsborough (and don’t even get into other counties) get together and do any joint planning, let alone really cooperate.  Maybe Orlando is organized and cashing in (they are), but the Tampa Bay area is no where near that level.

Regardless, it shows what other areas are doing, and where we should be.

– Riverwalks for All

Given all the talk of making the river the focus of Downtown Tampa and about the Riverwalk, both of which are fine with us (though if the river is the focus of downtown, the west side needs to be relatively dense), we decided to look for other riverwalks in Florida.  Interestingly, there are a number (some complete, some not): Miami, Ft. Lauderdale, and Jacksonville (see here and here).

– Transit

While the Tampa Bay area goes back and forth regarding transit, including rail, Miami is now considering whether to build another rail line, this time between downtown Miami and Miami Beach.   Obviously, this would require traveling over water.  The article does not indicate whether FDOT would be putting any money into the project or leaving paying for it to locals.

List of the Week

In light of all the stories about why you should visit St. Pete, our list this week is a Yahoo! Travel list of 10 classic steakhouses to visit.   They do not appear to be in any particular order, so we will just list them as they appear in the article.

Peter Luger, New York City; Keen’s Chophouse, New York City; The Snake River Grill, Jackson, Wyo.; Gene & Georgetti Steakhouse, Chicago; Musso and Frank Grill, Los Angeles; House of Prime Rib, San Francisco; Bohanan’s Prime Steaks & Seafood, San Antonio, Texas; Bern’s Steakhouse, Tampa, Fla.(there’s that “Fla” again); The Angus Barn, Raleigh, N.C.; Ye Olde Steakhouse, Knoxville, Tenn.

One Comment leave one →
  1. EJB permalink
    January 31, 2014 3:29 PM

    Who is Republic Land? I cannot find a corporation under that name in Florida Department of State. Who are the representatives? This proposal is starting to smell. Please post answers.

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