Real estate loans in South Florida have traditionally been large – they have to be to accommodate the price of property in Miami-Dade and the surrounding counties. However, those loans are getting larger. The biggest banks in SoFla are now routinely offering real estate loans 10% larger than previous financing packages, marking another year of significant growth for SoFla.
A Look at the Growth
In 2014, the 15 largest banks in South Florida managed to expand their real estate loan portfolios by over 10%, the FDIC reports. This growth wasn’t relegated to Miami-Dade County alone. Broward and Palm Beach counties also saw significant growth. Most of the growth occurred in increased loan volume through acquisitions. However, there’s also organic growth occurring in the market. It’s not all about acquisitions. New residents and new businesses are steadily streaming into South Florida. In total, the loan expansion included construction and land development packages, as well as multifamily, residential and commercial mortgage loans. (Click here to research Miami real estate)
The Largest Increases
While the 10%+ increase was across all 15 of SoFla’s biggest banks, not all financial institutions saw the same growth. The single largest increase came from Florida Community Bank, based in Weston, FL. FCB experienced a 55% jump in loan amounts, going from $1.6 billion in 2013 to $2.4 billion in 2014. Part of that growth stemmed from FCB’s $596 million acquisition of Great Florida Bank of Coral Gables.
Another high performer was Stonegate Bank out of Fort Lauderdale, which saw a 54.5% increase in real estate loans (rising past the $1 billion mark from just over half a million the year before). SBoFL acquired Florida Shores Bancorp, as well as that company’s subsidiaries to add $555 million.
Capital Bank, based in the city of Miami but also serving Tennessee, as well as North and South Carolina, also added to its success. It purchased $46 million in residential mortgages to create a 5-year total of $4.7 billion.
Where the Rejuvenation Starts
The growth in loans has been significant, just short of staggering. There are several attributable factors here, but one of the major ones is the creation of the Brickell City Centre (Click here to view the project), which BankUnited’s Florida president said was one of the hotspots in the area fueling his bank’s growth and success. Others point to the approval of the creation of Miami Worldcenter, as well as Miami SkyRise and other high-profile developments in town.
However, it’s not all about new projects. There’s also less leverage out there, which banks have cited as creating a healthier financial market in the first place. “Florida is back,” stated BankUnited’s Florida president, Thomas Cornish. A quick look at the various industries served by the 15 largest banks in SoFla certainly seems to hold up that assertion, with residential mortgages increasing by almost 12%, commercial real estate loans growing by 12.3% and multifamily loans growing by 6.7%.
All in all, 2014 has been a banner year for Florida’s banks, but also for homebuyers, construction companies and businesses of all types.