Strong demand for collective housing loans
South Florida banks continue to see a slight increase in commercial loan applications for small businesses, mid-market and multi-family housing projects in the tri-county area as the Covid-19 pandemic has barely slowed down Requirement.
Among the most requested commercial loan applications are SPA loans – contract of sale and purchase – “anything to do with buying a warehouse or financing a building for themselves,” JC said de Ona, President of the Southeast Division of Centennial Bank.
âWe also saw a lot of things on the residential side, like multi-family projects, the development of single-family homes, townhouses; everything from small pre-sold projects to very high end luxury homes, which have been very active today because there is very little inventory and a lot of demand, âhe said.
According to Matthew Bruno, senior vice president and middle market manager of Amerant Bank, there is an increase in pent-up demand for commercial loans from different industries. âWe’re seeing a bounce back from a lot of these customers in 2021,â he said, âand actually better this year than in 2019.â
Some of the loans for which Amerant Bank has seen a steady growth in demand are equity lines of credit, commercial equipment financing, and investment loans for commercial real estate. “Also, [there is] an increase in SPA loans, where the bank is very strong, âsaid Bruno.
Nick Miceli, Florida regional president for TD Bank, said 2021 was a good year for small business finance.
âWe have seen a very strong trend for new small business loans to existing clients and many new ones who have had the opportunity to work with us for the first time during their PPP program,â Mr. Miceli said, referring to the coronavirus paycheck protection program. The Aid, Relief and Economic Security Act the federal government rolled out last year to help small businesses maintain their workforce during the pandemic.
âThe Florida market has never seemed to be as affected by Covid-19 as other parts of the country,â Mr. Miceli said, âand also appears to have recovered faster than many of them. The stimulus money put into the system and P3 loans have certainly helped keep the economy growing strong, and we are even seeing the tourism industry come back as Florida continues to be an attractive destination.
But for PNC Bank’s South Florida Regional President Cressman Bronson, the pandemic painted a less positive outlook.
âWe continue to see that the supply issues associated with the Delta variant continue to weigh on the economy,â said Mr. Bronson. “We’re a little concerned about the possibility of an increase in defaults in the commercial real estate industry, which involves hotels and retail offices, due to the pandemic.”
He said that the more of our country’s workforce continues to work from home, the more permanent the shift from work to office becomes, reducing clients’ needs for commercial real estate and office space.
According to the Bank of America’s 2021 Small Business Owners Report, only 39% of small business owners rate their business’s finances as strong.
For banks like Centennial Bank, funding for construction projects continues to advance, said David Druey, its Florida regional president, despite any challenges related to Covid-19.
“We never really saw a slowdown even during covid,” Druey said. âWe have seen housing values ââincrease again; we have seen rental properties increase. We have never seen a slowdown during the quoted “slowdown” that has taken place across the country. “
And with projects like Sweetwater’s Li’l Abner Apartments, a 244-unit, 250,992-square-foot affordable senior housing project that Centennial Bank is funding with project manager Raul Rodriguez, Druey said he was confident in the Miami market.
âWe will continue to view Hialeah as a high growth area,â he said. âWynwood is also a hot place. Whenever there are big companies that come into the county, like tech companies, you will see a really good cross-section of what exactly you want to see, like service providers, white collar companies. It is a ripple effect.