Tampa-St Petersburg
• Cap rates in the Tampa-St. Petersburg area are, on average, higher (0.32 percentage points) than that of the state, and range from 8.5% (Apartments) to 16.4% (Condo Conversion).
• Cap rates increased over the past quarter across most property types, with the largest changes occurring in Condo Conversion (+6.92% change) and Free Standing Retail (+0.74% change).
• Cap rate outlooks indicate that rates are expected to either remain the same across most property types in the next quarter. The strongest indication of a cap rate increase occurs in Flex Space.
• Required yields for Tampa-St. Petersburg are higher, on average, than that of the state, 13.62% compared to 12.75% statewide.
• Required yields are highest for Condo Conversion at 19.1% and lowest for Free Standing Retail at 11.6%.
• Required yields decreased across all but two property types last quarter. The largest shifts in required yields occurred in Condo Conversion (-3.31% change) and Warehouse and Distribution (-2.18% change).
• The investment outlook is mixed across property types, with the most positive outlook occurring in Warehouse and Distribution and Neighborhood Centers.
• The outlook for Land Development appears to be neutral to negative for all land classifications.
• Future occupancy rates are expected to be the same or decrease over the next quarter for the majority of property types. The strongest indications of occupancy rate decreases occur in Strip Centers and Large Retail.
• Rental rates are expected to increase slower than inflation across almost all property types over the next quarter.
• Future absorption rate expectations are neutral for both Condominium Development and Single Family.
• Future price increases are expected to occur at a rate that is slower than inflation for both Single Family and Condominium Development.
Click here for the entire report from the Bergstrom Center for Real Estate Studies.
