“Everybody knew three years ago that Brickell was going to be overbuilt and downtown was going to be overbuilt with condos.” — Economist Laura Kozloski Hart, visiting associate professor of international business and strategy at Barry University
 Miami
Three of the county’s biggest industries — tourism, financial services and real estate — have been hit hard and are unlikely to recover this year, and unemployment is up — now 6.8% — and rising.
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“I don’t think 2009 is going to be a whole lot better than we have it now,” says economist Laura Kozloski Hart, a visiting associate professor of international business and strategy at Barry University. “Miami-Dade’s economy is pretty much dependent on services: Tourism, financial services, healthcare and trade services.” With the exception of healthcare, all have declined this year.
Unemployment could reach as high as 10% this year but shouldn’t rise much higher, Kozloski Hart predicts.
While the recession has been widespread, most agree that it started with the real estate boom. “Everybody knew three years ago that Brickell was going to be overbuilt and downtown was going to be overbuilt with condos,” Kozloski Hart says.
More than 56,600 mortgage foreclosures were filed in the county in 2008, according to the Clerk of Courts’ website. This January saw 6,042 filings, more than in any single month last year. Industry experts expect those numbers to rise and property values to fall for at least the first half of this year. But, “sales have generally started to increase from their lows, mostly due to the greater affordability and decreased pricing,” says Adam Cappel, president of CondoReports.com, which tracks detailed data for individual condominium buildings and units.
Economist Laura Kozloski Hart recommends a tax holiday for companies that have had mass layoffs but agree to rehire their employees and guarantee them jobs for two years. [Photo: Brian Smith] |
As of the end of last year, 356 of the Miami-Dade residential condo buildings in CondoReports.com’s database were down 50% or more from their peak per-square-foot value. On the other hand, 7% of the buildings in its database actually increased in value during 2008. “Certain neighborhoods and certain buildings are going to stabilize and experience appreciation much faster than others,” Cappel says.
While real estate was the first sector to slump, tourism — the county’s top industry —was perhaps the last. December occupancy was down 8.5% from a year earlier, and room rates fell 6.6%. Both occupancy and room rates are likely to decline further as both leisure and business travel continue to fall. And, although the county’s visitor numbers have often been buffered from declines because of its international appeal, “I think the fact that this recession is global is going to hit at tourism,” Kozloski Hart says.
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