Hurn basis his prognosis on crisp lending activity that is occurring at his institution. Mercantile has closed six commercial property loans totaling $5 million in Orlando, Tampa, Jacksonville, South Florida and Puerto Rico. Another $11 million in loans is pending.
"We're beginning to see a trend emerge in Florida for small to mid-sized businesses to own instead of lease their commercial property," Hurn says. "This is analogous to eventually owning a home instead of just renting, but it is also the result of 45-year low interest rates; advantageous but relatively unknown lending programs (like the 504) becoming more widely known; and a desire of business owners (especially professionals) to locate nearer to their homes to avoid commuting to city centers."
Hurn says the trend "bodes well, long term, for real estate professionals and lenders alike, and is a positive for the economy as well." The banker tells GlobeSt.com Mercantile has 42 deals "in the pipeline right now, with 12 applications scheduled to close in the next 60 days for just over $11 million."
The closed deals include two loans totaling $1.3 million for Financial Building Services which refurbishes ATMS throughout the Southeast. One of the loans refinanced the firm's existing facility in Jacksonville; another funded the acquisition of a facility in Pompano Beach.
Other loans included $1 million to CPH Engineers Inc. to acquire and renovate a building in San Juan, Puerto Rico; $750,000 to MRI Management Recruiters of Tampa to construct its headquarters building; $1.3 million to direct Wireless, a Nextel service center, to acquire and build its own office-warehouse facility in Sanford; and $660,000 to Powell Design Group of Orlando to refinance their stand-alone office building on Par Street.
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