Downtown Tampa

TAMPA – June 27, 2008 – In 2003, Tampa Mayor Pam Iorio launched a campaign to turn the city’s small, sleepy downtown into a thriving core of offices, condos, stores, restaurants, and bars. The city’s 760-acre downtown would be transformed into a 24-hour hub of activity where residents could work, shop, play, and wake up each morning without dreading another traffic-clogged commute.

The downtown area would come to life with about 11,000 new condos, a 19-story office building [the first new downtown office tower in two decades], and new shops and restaurants. And the downtown population, which is now about 2,000, would swell to about 20,000.

City planners had every reason to believe they would be successful. The housing boom was in full swing, and young professionals and empty-nesters across the nation were coming back to city centers, which the middle class and affluent had all but abandoned starting in the 1960s in favor of suburbs where crime was lower, houses were larger, and schools were better. But during the last decade, cities from Miami and West Palm Beach to Philadelphia, Atlanta, Houston, and San Diego suddenly were hot again.

But everything changed for Tampa and for many other cities with the housing slump and foreclosure crisis, which was intensified by the year-old credit crunch. Now only about 3,500 of the planned condo units have either been built or are under construction in the downtown area, and many remain vacant. The office building also has been delayed.

Optimism for cities

“It was a false start you might say,” said Patrick Berman, senior director, retail brokerage for Cushman & Wakefield Florida, a real estate advisory group. “The market really slowed down. It was difficult to finance deals. People made deposits on condos and didn’t close.”

Berman, who lives two miles from the downtown, said that he’s certain that Tampa will finish what it started as soon as the housing market returns. He said cities haven’t lost their luster – it’s just that home buyers have become scarce. In fact, there is evidence that real estate in cities around the nation is doing better than in suburbs, especially in more distant suburbs where land was cheap and builders created an oversupply of houses.

And prices in many urban centers went up much more during the boom than they’ve fallen since. In Miami, for example, home prices nearly tripled from March, 1999, to March, 2006, when prices finally began to flatten, according to the S&P/Case-Shiller Home Price Index. By comparison, prices were down 24 percent in March, 2008, compared to March, 2006.

Monthly Sales

Statistics in the MLS show that between 4/26 to 5/25, 2300 homes closed.

Price range varied from as low as $12,000 up to 5 million.

The number was down from the previous month and 68% lower than the 2005 sales reported during the same period.