Idea Vault
3 Key Take-a-Ways from the Radius Real Estate and Economic Forecast
American Riviera Bank was once again a proud sponsor of the 13th Annual Radius Real Estate & Economic Forecast event held on February 28. Our team listened to expert analysis on the local and national economy, along with Radius's updates and insights into the local commercial real estate market. Please read our key take-a-ways from the event below.
American Riviera Bank was once again a proud sponsor of the 13th Annual Radius Real Estate & Economic Forecast event held on February 28. Hundreds of the region’s business and community leaders convened at the Hilton Santa Barbara Beachfront Resort to hear expert analysis on the local and national economy with a focus on the commercial real estate industry.
Renowned economist, Dr. Chris Thornberg of Beacon Economics, delivered the keynote address, marking his fifth appearance at the conference. Thornberg is also the Director of the Center for Economic Forecasting and Development at the UC Riverside School of Business Administration.
Radius Principal and Co-Founder, Steve Brown welcomed attendees with opening remarks where he thanked American Riviera Bank for being a sponsor and a “quintessential community bank” serving our local region. Please read our key-take-ways from this insightful event.
Steve Golis, Radius Principal and Co-Founder, kicked off the economic forecasts with an update on local and national Multifamily Investments. His insights for 2023 included: interest rate hikes will make debt less affordable, investors are being more cautious in the current environment, and vacancy rates will remain low. He noted that spaces are selling with multiple offers being made despite the perception of the difficulty to buy in the region and recognized ARB for their support in providing the community with loans to make this happen.
Brad Fohling, a Radius partner, gave an update on the local leasing market in the South Coast. His 2023 insights include: low vacancy and stable rates in industrial commercial real estate, new multi-tenant industrial projects are already planned for the local region, and office space demand remains lethargic especially in the larger tech industry.
Radius Principal, Gene Deering, spoke on commercial sales updates. He said that in 2023 we are seeing a strong demand for investors in Montecito. Most notably he provided insight into Adaptive Reuse strategies being implemented across the region. Adaptive Reuse is the process of converting an underutilized property type into a new property type to meet higher demand in that sector. He pointed out that some office space properties in downtown Santa Barbara are being renovated into residential housing and that this continued practice of adaptive reuse could provide the region with creative solutions to housing.
This year, during his keynote address, Dr. Thornberg brought a new perspective to the narratives around inflation, recession rumors, and “real worries” like labor shortages. His most notable point was his projection that a recession is “highly unlikely in the next 2 years.” He continued to say that there are no major structural imbalances in the economy and that although asset prices will continue to slowly deflate, fundamentals will remain decent.
Throughout the presentations a reverent mention was given to north Santa Barbara County, specifically Santa Maria. The panel of experts agreed that investors have been looking at Santa Maria for years as a place for development opportunities and they will continue to look at commercial development opportunities for years to come as the valley is projected to see increased commercial real estate economic growth. ARB is pleased to hear experts are looking at Santa Maria’s economic potential, which is why ARB opened a new commercial banking center branch in Santa Maria that will meet the diverse banking needs of a region experiencing rapid economic and community growth. Products and services will support businesses, retail operations, mortgage and more.
ARB continues to grow a robust business and consumer banking profile and we are proud of our #1 market share status in SBA lending in Santa Barbara and San Luis Obispo Counties. In addition to SBA lending, ARB offers traditional commercial loans and lines of credit, with more than half of all loans of $1 million or less made to small business owners. ARB believes that this sponsorship of an economic forecast is important to keep the community, stakeholder, and business leaders informed on the economic vitality of the South Coast region.
Previous: Stolen Checks on the Rise Next: Is My Money Safe?