Commercial lenders seeing glimmer of good news

Construction continues on Laurel Vue apartments on SW 5th Avenue and SW 12th Street Wednesday, January 11, 2012.

Doug Finger/Staff photographer
Published: Wednesday, January 11, 2012 at 2:31 p.m.
Last Modified: Wednesday, January 11, 2012 at 9:44 p.m.

Area commercial lenders say they see some signs of a tentative recovery in Gainesville but that conditions for the year ahead will depend on the effect economic news has on the confidence of consumers and businesses.

Brian Miller of SunState Federal Credit Union said he has seen an unseasonal uptick in business after a September that was his worst month ever.

Lenders say they are seeing more investor interest in commercial properties, especially foreclosures and short sales, and investors are asking about the lending available to finance the purchases.

"There's definitely a lot of interest starting to come back into the market," Miller said.

A panel of seven bankers discussed the state of lending and the economy Monday at the Gainesville-Alachua County Association of Realtors Commercial Council meeting.

Some businesses are adding second locations or refinancing, said Steve Jeppson of Florida Credit Union.

Medical practices are cautious but looking for workers, as are other area businesses, said Melanie Shore of M&S Bank.

David Barber of Campus USA Credit Union said he closed $6 million in loans in the last quarter. That includes financing for KLM Property Holdings to build the 24-unit apartment complex Laurel Vue now under construction on Southwest Fifth Avenue near Sorority Row, and for businesses such as a high-tech startup and a psychiatry practice to buy their own offices.

Barber said he expects steady growth this year, but that could depend on consumer psychology.

He mentioned news of strong attendance at theme parks over the holidays and increased hotel business after gas prices stabilized before shooting up in recent weeks as Iran threatened to cut off a key oil supply route.

"Activities like that take everything that had some momentum to it, and what does the consumer think? ‘Oh my gosh, here we go again.' And so small businesses think that way. ‘Oh my gosh, here we go again,' " Barber said.

Now, businesses are waiting for the Supreme Court to rule on the federal health care law, expected later this year, to see what their insurance costs are going to be before investing in expansion, Barber said.

If people looked around Gainesville — which the lenders agreed is doing better than surrounding communities such as Ocala and Jacksonville — they would feel more optimistic than they would just following economic news, he said.

Don Davis of Capital City Bank said this is the time when businesses assess the prior year to decide how to move forward, and if they can't decide, they don't seek loans.

"I've seen a few people saying, ‘I think I'm getting out. I'm looking for my exit strategy, even if it takes a year,' " he said.

"I think if we could get in the head of all the small-business owners and somehow get a consensus, what we'd find is they're all scared."

Laude Arnaldi of Florida Citizens Bank said the commercial market will improve after people start buying homes. He said he hopes U.S. job growth of 200,000 in December continues and eases consumers' anxiety.

Danny Gilliland of Gateway Bank said apartments are a good investment with growing demographics.

Other lenders said they are especially eager to make loans to owner-occupied commercial properties but are competing with each other for a limited number.

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