Tampa is reportedly the hottest market of 2022 and the data supports the great migration to the heart of Florida. But why Tampa?
Ned Roberts, CCIM, Adam Podbelski, and Jason Hague of RPH Multifamily Group in the Marcus & Millichap Tampa office specialize in multifamily transactions. Over the last year alone, RPH Multifamily Group has closed more than 60 transactions with 265 offers totaling over $250 million across more than a dozen counties. As all-stars of the multifamily real estate market, they do not see an end in sight.
“Tampa’s increasingly diversified economy – including a growing tech scene – is driving investment in the city and surrounding counties. It’s an incredible place to live, with a comparatively lower cost of living,” said Roberts. “To a large degree, Tampa’s growth has been spurred by new developments and the revitalization of downtown. For instance, Bill Gates is a majority investor in Waterstreet Tampa, a new, $3-billion, 56-acre development, which is completely transforming downtown Tampa into a modern urban co
mmunity with a diverse mix of retail, fine-dining and luxury living. Individuals and businesses are taking notice and moving here, including Fortune 500 companies like Pfizer, which now has a significant presence in Tampa.”
Other large corporations now call Tampa home, including Publix Super Markets, Jabil, Mosaic, Raymond James Financial, and Roper Technologies. According to Marcus & Millichap 2021 Investment Outlook, out of 43 major U.S. Markets, the Tampa MSA (Metropolitan Statistical Area) has seen more job growth today than before the pandemic. In fact, only five U.S. metros have exceeded their pre-pandemic overall employment level, and Tampa is one of them.
Tampa is currently ranked #4 as the highest growing metro across the sunbelt, behind Jacksonville (#3), Austin (#2), and Salt Lake City (#1). And it is not just the boom in tech or the employment opportunities; it is all about location, location, location.
“Comparatively to the rest of the country, Tampa means nearly 250 days of sunshine, coastal living on a peninsula, surrounded by the state’s prettiest beaches where residents pay no income tax. Tampa is on the map; the secret is out,” added Podbelski.
Tampa’s average rent is well below major gateway markets, which has helped further stimulate demand for those looking for lower living costs with high quality of life considerations, including the year-round warm weather and new career opportunities.
More people are starting to think of Tampa when they think of Florida, not just Miami. The team has seen a surge of investors from California, the Northeast, New York, Boston, LA, and Chicago.
The greater Tampa Bay area is poised for continuous expansion as well. A 24% increase in housing values is spurring growth in surrounding areas. According to the team, tenants seeking more affordable options are driving double-digit rent growth in nearby submarkets like Bradenton and Sarasota.
“These are unprecedented times here in Tampa, with rents and values continuing to soar, there seems to be no end in sight,” added Hague. “It’s reminiscent of the massive boom we saw in South Florida over the past couple of decades, and like Miami, we have some of the best-voted beaches and waterfronts in the country packed into the most densely populated county in the state. For residents here, you can’t go wrong with St. Pete Beach, Clearwater Beach, Indian Rocks Beach, Treasure Island, along with the state parks like Honeymoon Island and Caladesi Island State Park. It is different from the South Beach vibe, but it has a vibe of its own.”
Multi-billion-dollar developments, gorgeous white sandy beaches, a thriving housing market, and for sports lovers, Tampa is also a champion city. Often referred to as “Champa Bay,” the city has been winning big time. The Tampa Bay Lightning won the NHL’s Stanley Cup, Tampa’s second consecutive NHL title in 10 months; the Tampa Bay Buccaneers won the 2021 Super Bowl LV, which was held at the Raymond James Stadium in Tampa, Florida; and the Tampa Bay Rays made it to the World Series in 2020.
For RPH Multifamily Group and the Tampa office of Marcus & Millichap, the wave of interest in the area is proving to be the tip of a very lucrative iceberg.
“The core strength of our team is that we are headquartered in the Tampa market, but we simultaneously access more tertiary markets throughout Florida. This allows our clients to pursue more deals where they don’t encounter as much competition,” said Roberts. “This includes bringing in 1031-exchange buyers who are highly probable to close.”
Marcus & Millichap is the industry leader in 1031 exchanges, many of which are executed by the firm’s RPH Multifamily Group in Tampa. The team’s enduring authority in the market shows no signs of slowing down, with 11 deals currently listed totaling $68 million and 11 under contract totaling $57 million, with more on the horizon.
