Leon, Hortense, Mortgage Banking
Miami-Dade County has a lot going for it. The market is a hub for international business and trade, tourism is only slightly off in spite of Latin American woes and the office/industrial/retail markets are solid. Lenders say business is moving to a nice beat.
SINCE THE EARLY 1980s, MIAMI HAS BEEN THE UNOFFICIAL COMMERCIAL CAPITAL OF LATIN AMERICA AND THE CARIBBEAN. In fact, 150 companies, U.S. and foreign, have their Latin American and/or Caribbean headquarters in Miami-Dade County, including such household names as Texaco, AT&T and Hilton.
Even some Latin American companies prefer to locate headquarters operations in metropolitan Miami rather than in their home countries. Two years ago, Lan Chile Airlines moved its cargo headquarters to Miami from Santiago, where its passenger operations are still located.
In the real estate industry, the amount of foreign capital invested in the area-which comes primarily from Latin America and Europe-is striking. According to a survey by the Miami-based Appraisal & Real Estate Economics Associates, Inc., foreign buyers increased their real estate purchases in South Florida (Miami-Dade, Broward and Palm Beach counties) for the third consecutive year in 1998. The dollar volume of acquisitions last year was $1.127 billion, the most spent in the region since 1981 when the total was $1.4 billion, and 47 percent of the acquisitions were in Miami-Dade.
Foreign buyers accounted for 14 percent of all real estate sales in 1998 and owned 13.6 percent of the land and income-producing commercial buildings in Dade-Broward and Palm Beach counties.
Foreign influences notwithstanding, the local economy is primarily driven by the national economy, says Robert Cruz, professor of economics at Barry University in North Miami. According to Cruz, even in the 198os, when the Latin American debt crisis was prolonged, although there was a slowdown in the Miami area, the turmoil south of the border didn't precipitate a recession in the county's overall economy.
Last year, Miami-Dade County had an inflation-adjusted growth rate of 3.5 percent. That was the fourth consecutive year of vigorous growth. The county's economy grew at an annual rate of 3.7 percent from 1994 to 1998, compared with 1.6 percent annually from 199o to 1994. Cruz says he expects to see a 2.5 percent to 3 percent growth rate for the county in 1999.
According to the Florida Department of Labor and Employment Security, the unemployment rate for the county was 6.6 percent in April 1999-the same as in April 1998. The difference between the two years, however, is that as the labor force grew, from 1,oig,157 to 1,044,052, so did the number of jobs.
In spite of this relatively good news, Cruz says there are clouds on the horizon. "It looks like Venezuela could experience a significant devaluation, although that country's economy has been contracting for a while. Brazil is not in good shape, although it has had some positive news lately, and Colombia is not doing well, and these are our major trading partners," he says.
Among broad industry groups, the transportation sector has been Miami-Dade's leading growth industry in recent years. Transportation services grew at an annual rate of 6 percent between 1994 and 1998, according to Cruz and the Greater Miami Chamber of Commerce. That growth is measured by the value added, which is a combination of profit and labor income.
The county's overall growth in the last few years has been fueled by growth in private, nonfinancial services and financial services, including real estate. The rate of growth for private services in the county was 4.5 percent per year between 1994 and 1998 and for financial services was 3.8 percent per year during the same period.
The Greater Miami Convention and Visitors Bureau, which tracks the tourism industry, tallied 9.7 million overnight visitors to …
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Publication information: Article title: Miami's Momentum. Contributors: Leon, Hortense - Author. Magazine title: Mortgage Banking. Volume: 59. Issue: 10 Publication date: July 1999. Page number: 60+. © 2009 Mortgage Bankers Association of America. Provided by ProQuest LLC. All Rights Reserved.
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