Q&A: Catching Up With Colliers’ Ryan Kratz

Ryan Kratz, president, Colliers International Southeast Region

As President of Colliers International’s Southeast Region, Ryan Kratz is responsible for an area consisting of 20 offices and more than 350 brokers. Based in Miami, he also holds a dual role as the Market Leader for the firm’s South Florida (Miami, Ft. Lauderdale, West Palm Beach) operation.

Kratz is one of several featured speakers at Connect South Florida Feb. 26. We caught up with him to discuss South Florida’s dynamic CRE market ahead of the event.

Connect South Florida is coming to Key Biscayne on Feb. 26, 2020. For more information, or to register, click here.

Q: South Florida’s CRE market is one of the most diverse in the nation. What do you think will be some of the biggest storylines and trends in 2020? 

A: Robust market activity continues in all property sectors.  Investors and developers continue to aggressively pursue all primary asset classes (office, industrial, retail, multifamily). Alternative classes (hotels, medical office, seniors housing, student housing, etc.) are equally active. Land for future development should continue to transact at strong pricing levels throughout 2020.

Q: As you know, we are having a panel on “Miami’s Mega Projects” at our conference later this month. Can you talk about the effect that large-scale mixed-use projects are having on the market as a whole?

A: Projects like Miami Worldcenter, CocoWalk, River Landing, Plantation Walk, Metropica, urban Fort Lauderdale, Brightline/Virgin, multiple collective projects in Downtown Miami, among other projects, serve as a barometer for the health and vibrancy of the market. The planning, resources, capital required, and tenant demand needed for mega projects is tremendous.  Simultaneously, mega projects nearly always spur ancillary smaller scale development and investment in the immediate, adjacent area. 

Q: What’s the lending climate like right now in South Florida? Are you still seeing a lot of international capital flow in? Is it getting harder to get deals/projects financed?

A: The emblematic word I use to describe the lending market today is disciplined.  We are seeing lenders cautious in their underwriting, cautious on their loan-to-value ratios, and careful not to overextend on projects that generally won’t stand the test of time and market fluctuations.  This discipline applies to lenders of all types: life insurance companies, commercial banks, government sponsored lenders, and CMBS.  International capital is prevalent in the market, it ebbs and flows to be sure, but this discipline extends to these international financiers as well, even those seeking to place “safety capital” intended to be in the market for a longer term than the typical hold period.  Capital availability is plentiful (and at historically low rates) to finance projects, but that capital is judicious in how it’s placed.

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