Bilzin Sumberg survey of region’s top executives identifies chief areas for growth amid lingering obstacles; Latin America, China, Russia seen as largest sources of inbound investment over next 12-18 months
MIAMI – December 18, 2012 – A majority of Miami business leaders believe the South Florida economy is ‘growing slowly’ and that this trajectory will continue through 2013, driven by steady inbound investment from Latin America, China and Russia. The New Miami Investment Survey, commissioned by Miami-based law firm Bilzin Sumberg, surveyed 200 Miami executives, with approximately 60 percent of respondents characterizing the region’s economy as ‘strong and growing’ or ‘growing slowly.’ According to the report, the chief obstacle to economic progress is the city’s substandard transportation system, with more than half of respondents calling for significant infrastructure upgrades.
“At a time when other parts of the country are still struggling, Miami is seeing a record level of activity on the part of major international players placing confidence in our city as a business center and investment target,” said John Sumberg, Managing Partner of Bilzin Sumberg Baena Price & Axelrod, LLP. “This can be attributed to a number of factors, including the city’s gateway status; the affordability and availability of quality assets; attractive climate; and Miami’s strong brand perception around the world.”
Following are key findings from the Bilzin Sumberg New Miami Investment Survey:
- Growth comes largely from real estate, tourism and hospitality: Close to 60 percent of respondents see investment pouring into real estate over the next 12-18 months, with condominium homes (33 percent) and multifamily rentals (38 percent) being the most attractive assets. Of survey respondents, 13 percent attribute growth to the hospitality and leisure sectors, with 73 percent of respondents believing current conditions for tourism to be better than they were a year ago.
- Individual investors dominate South Florida investment: Nearly half of respondents believe that individual investors (48 percent) will serve as the primary source of investment over the next 12-18 months.
- Financing environment continues to improve: More than half (58 percent) of respondents believe the financing environment has improved since 2011, with the chief sources of capital and debt financing being venture capital funds (30 percent) and community banks (27 percent).
- Economy showing signs of slow but steady improvement: More than half of those surveyed (52 percent) see the economy as ‘growing slowly’ with seven percent responding that it is ‘strong and growing.’ Only 16 percent believe the economy is weak.
- Latin America dominates investments but other regions are increasing in activity in South Florida: Latin America remains the top market for inbound investment, with 72 percent of respondents believing Brazil will be the primary source of activity, followed by Venezuela (16 percent). The next 12-18 months should see an increase in investment from beyond the Americas, with China (28 percent) and Russia (27 percent) viewed as the largest growth markets.
The report shows barriers to economic growth remain, particularly in the area of infrastructure. More than half of respondents (55 percent) believe Florida’s current transportation systems require significant improvement. A majority of those surveyed believe Miami International Airport (50 percent) and Port of Miami (59 percent) are the region’s chief assets for luring new investment.
Participants in the New Miami Investment Survey also believe that Miami’s dominant tourism industry is on the uptick, with 58 percent of respondents saying the sector has grown slowly in the past year.
“South Florida, and Miami in particular, stands out today as one of the hottest growth areas in the nation,” said Brian Bilzin, partner and co-founder of Bilzin Sumberg. “Functioning as a gateway to Europe as well as to Latin America and Asia, South Florida’s thriving tourism and hotel industries have inspired the confidence of individual and institutional investors who, confronted with economic challenges around the world, are seeking markets already in growth mode.”
According to Mr. Bilzin, Miami is at a dynamic point in its history, undergoing an incredible rebirth that has it poised to emerge as a global destination and major world class city. The firm chose to undertake this study in order to measure the confidence level of its business community and to reveal what business leaders think are the critical issues central to South Florida’s future as 2013 nears.
In addition to the New Miami Investment Survey, Bilzin Sumberg has also launched a New Miami Blog, where firm members and guest bloggers monitor the pulse of the local business community and share insights on the city’s global economy.
For a downloadable copy of the full report, please click here.
Demographics and Methodology
In the third and fourth quarters of 2012, the law firm of Bilzin Sumberg distributed its New Miami Investment Survey via e-mail to a group of senior executives and advisors including CEOs, CFOs, CLOs, and other company officers. Thirty-five percent of the 198 respondents identified themselves as a company officer or executive and 21 percent identified themselves as a manager or part of senior management. Industries represented include real estate (16 percent), legal (38 percent), and insurance/banking/financial services (12 percent). Survey respondents include 65 percent who work for local businesses, and 17 percent who work at multi-national companies. Among respondents, 58 percent are employed by organizations with 50 or fewer employees, and 27 percent are at organizations of 250 or more employees. Due to rounding, all percentages used in all questions may not add up to 100 percent. For more information about the survey please contact Laura Murray, Director of Marketing, at 305-350-7393 or firstname.lastname@example.org. To access the full report please click here.