Commercial Real Estate refers to the property which is used only for business purposes. It is thus pretty clear that this particular type of property is not developed for residential purposes and the location has to be where there is ample scope for business or any other commercial activity. Offices, parks, shopping malls, hotels and restaurants etc. are various types of commercial properties and it is the quality and quantity of commercial properties that make a city truly developed.
Florida is the south-western state of the USA and being a peninsula, it is a wonderful tourist spot as well as business ground. Having Atlantic Ocean in the east and great connection with inland waterways, this place is ideal for the development of business and thus, the importance of Commercial Real Estate is supreme. Having the longest coastline among all the other states of United States of America, Florida possesses the best ports of the country and is favoured by most of the business organizations which are engaged in import and export sectors to have their offices here. But not all places in Florida are blessed with the coastline and Lakeland is one among such landlocked places of the state. Nearness to the capital is also another factor that enhances the Commercial Real Estate market of the place.
While talking about the factors which affect the real estate market and most specifically the Commercial Estate market, it must be considered that they are not much different from other parts of the world. But, Florida has its own specialities for having the geographical specification (i.e. being a peninsula) and nearness to the national as well as business capital of the country. There are several factors which affect the present as well as future market value of commercial properties. With the dynamic changes happening in the business sector these days, the future of commercial real estate market has turned out to be one of the most vulnerable fields.
Let us take a quick look at the basic factors which affect the Commercial Real Estate market in Florida:
- Supply: This is perhaps the very first thing to consider in all business and real estate market is no exception. Florida is one of the oldest settlements in United States of America and thus availability of unused land is pretty less. With the growth of business, the demand for commercial properties displayed a steady growth but the supply was not as required. People having residential properties right at the heart of the major cities were reluctant to give up their hold on the land but gave up to the demand when high prices were offered. The basic feature thus became high priced commercial properties and that has been the general trend all over the state.
- State rules: United States of America is characterized with different sets of laws for different states and Florida is no exception to this feature as well. The zoning and developmental rules which are to be followed in this state is pretty different from other states and thus the commercial properties have to abide by the specific laws. Business houses belonging to other parts of the country which are willing to have their office or business houses in Florida may find it difficult to adjust with the regulations prevailing here and thus their demand for commercial properties are affected.
- Taxation: Tax is compulsory for all types of properties and it is a known fact that commercial properties are heavily taxed as compared to residential ones. Various counties in Florida have their own taxation models and property owners sell or rent the commercial properties according to those rules. The popular and commercially populated places are obviously highly taxed in comparison to the less important business locations. With the development of communication system, it is now seen that several business organizations are choosing less important spots just to get some cost benefits.
- Location: Location of the commercial property has always been the most determining factor in this field and is the only factor that is considered in most of the cases. When a company is looking for space to start its new office, they will obviously look for the best location for the comfort of their clients and the property owners on the other hand will look forward to get higher prices for their properties.
- Future market: There is no single business which can leave behind the factor of future prospects. With the growth of virtual market and office facilities (i.e. through internet) it is evident that the demand for big shops or offices will be facing a decline in future. But Florida being blessed with the longest coastline in the country will always have great demand for commercial properties as virtual business can never decrease the demand of transportation of freight. Thus, spaces will always be in demand for shipping and storage houses.
Having discussed the five major factors which affect the commercial real estate market in Florida, we can now conclude that people who are having commercial properties in Florida should not lose hope for enhancement of the market in near or even far future.