Evan Vitale

Accounting Professional

Evan Vitale – Orlando Development and Investments

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Evan Vitale OrlandoCentral Florida and Orlando finished last year off with some promising investment sales, brand new developments, and leases.  That’s good news for the local economy, and hopefully a harbinger of more good housing/investment news to come.  There appears to be an interest in investing in the area, attracting investors who have cash and are looking for the next big moneymaker.  Investments of these sorts do more than offer a way for struggling properties to have a second chance at success.  We are seeing a boost in property values, construction jobs as a result of new developments and refurbishing, and more taxes taken in by local governments.   Biz Journal posted a list of some of the more notable closings, and I wanted to share some of that list here.

The first new condo complex in nearly ten years is going up in New Smyrna Beach.  The property is being financed by Eckell Development, who plan to break ground in just a couple months.  The plan is for a $16m condo development with nineteen units right on South Atlantic Avenue.  Units will be in the million dollar range.

Canadian companies like Highyon Shopping Center Investment Funds are getting in on the action.  This company bought the many commercial properties of Parkwood Plaza in Orlando, including a 150-thousand sq ft retail center.  Along with the purchase is included thirteen acres of land yet to be developed.  The purchase was just a little over ten million dollars.

In southeast Orlando, in Lee Vista, a 35-thousand sq ft space was leased by American Woodmark Corp.  American Builders & Contractors Supply leased a similarly sized space in Maitland, and Rite Rug leased a 25-thousand sq ft lease in southwest Orlando.  What exactly will happen with all of these properties remains to be seen, but it seems more and more like this is an exciting time to be living in Orlando.

Pine Ridge Dairy sold a 750-thousand acre plot in Fruitland Park in Lake County to the villages of Lake-Sumter, who plan on building over two-thousand residential units, a completely new neighborhood.  Adventist Health System is expanding, leasing another nearly 20-thousand sq ft of space in downtown Orlando.

One of the bigger sales of the last quarter of last year was by Cushman & Wakefield of Florida, who sold a 300-unit apartment complex in West Orlando to the Atlanta-based Carrol Organization.  The deal was over $35 million.

Here’s to some promising years in the near future!

Evan Vitale – Stimulus Program to be Reduced

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The federal reserve has decided to “taper” off the stimulus funding.  Beginning in January the Reserve will reduce the amount of bonds they have been buying from $85 billion to $75 billion each month.

Evan Vitale federal reserveThe Federal Reserve statement mentioned that the labor market conditions and the employment market could be improved with less purchase of assets each month.

Bonds that will be cut back on will be in two areas. Treasuries will receive less purchases per month (approximately $5 billion) and mortgage-backed securities will also see a $5 billion dip.

How did all of this happen?

It started with the Federal Reserve cutting their key interest rate in 2008 to nearly zero.  From there the program entered what is called “quantitative easing” also known as QE.  QE involved the Fed buying assets such as treasuries and mortgage-backed securities with hopes of lowering the interest rates for the long term.

QE was broken up into three terms which are now known as QE1, QE2, and QE3.  Of these three stages QE1 and QE2 had specific end-dates of which to judge them by.  QE3 does not have such a date but the Reserve says they are looking for “substantial” improvements for the stimulus and the job market.

The term “substantial” has been misrepresented by many members of the Federal Reserve such as Chairman Ben Bernanke.  Bernanke explained that he expected tapering to begin around towards the end of this year and stated it would stop buying bonds sometime in 2014.

Bernanke was also hoping that once the unemployment rate dropped to 7% that tapering would begin.  When it hit 7% last month there was no action however and now that tapering seems to be happening at an inopportune time.

Eric Rosengren, a Fed member, was not in favor of the tapering citing his belief that unemployment was still too high.

However the tapering effects the future is unknown and frankly up in the air. Bernanke will not be at the helm much longer to see it through as his 8 year term ends on January 31.  Janet Yellen was nominated by President Obama in October and will assume Bernanke’s old position beginning in February.