The Residential Market in Florida and the Southeast – A Special Presentation by Brad Hunter * Brad Hunter, Chief Economist, Nat’l Director of Consulting, Metrostudy

1. Brad Hunter
Chief Economist/
National Director of Consulting
(561) 573-8351
bhunter@metrostudy.com
Housing Overview
For Investors in Subdivisions/MPCs
Loan Portfolios, AD&C Debt, and CDDs
© Copyright Metrostudy 2010

2. Residential Investment
Opportunities
• IRR potential
• Contrarian Philosophy
• Where are the best deals likely to be?
• Where is risk highest?
• Where is the collateral, and how well
(or poorly positioned) is it?
• What data can help you find the best
risk-adjusted returns?
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3. 3
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4. 4
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5. 5
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6. 6
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7. 7
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8. How Much Excess Is Left??
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9. © Copyright Metrostudy 2010

10. 10
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11. 11
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12. 12
5,629,946 Total Lots
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13. 13
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14. 14
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15. Focus on South Florida
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16. Pockets of Strength:
Top 10 Subdivisions in South Florida, ranked by Starts
Starts Move-Ins
1. Valencia Reserve 280 206
2. Monterra 209 61
3. Parkland Reserve 150 137
4. Abacoa 117 123
5. Canyon Springs 98 129
6. Artesia 95 139
7. Oasis 73 94
8. Silver Palms 61 30
9. Pembroke Cay TH 59 25
10. Greystone 58 126
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17. M iam i-Dade Quarterly Starts v. M ove-Ins of
Detached Hom es
1600
4Q10 starts – 42
1400
4Q10 move-ins – 152
1200
1000
800
600
400
200
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
Q starts Q move -ins
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18. M iam i-Dade Detached - Units Under
Construction v. Finished V acant Units
3,000
4Q10 fin/vac – 260
2,500 fin/vac M-O-S – 9.9
2,000
1,500
1,000
500
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
U/C Fin Vac
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19. M iam i-Dade Quarterly Starts v. M ove-Ins of
Attached Hom es
1200
4Q10 starts – 33
1000 4Q10 move-ins – 164
800
600
400
200
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
Q starts Q move -ins
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20. M iami-Dade Attached - Units Under
Construction v. Finished V acant Units
2,500
4Q10 fin/vac – 773
2,250
fin/vac M-O-S – 21.8
2,000
1,750
1,500
1,250
1,000
750
500
250
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
U/C Fin Vac
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21. M iam i-Dade Attached - V acant Developed
Lots
3,000
2,750
2,500
2,250
2,000
1,750
1,500
1,250
1,000
750
500
250
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
VDL
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22. Palm Beach Quarterly Starts v. M ove-Ins of
Detached Homes
2,500
2,250 4Q10 starts – 201
2,000 4Q10 move-ins – 241
1,750
1,500
1,250
1,000
750
500
250
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
Q sta rts Q move -ins
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23. Palm Beach Detached - Units Under
Construction v. Finished V acant Units
4,000
4Q10 fin/vac – 245
3,500 fin/vac M-O-S – 2.9
3,000
2,500
2,000
1,500
1,000
500
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
U/C Fin Vac
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24. Palm Beach Detached - V acant Developed
Lots
8,000 3,000 lots seems like a goodly supply, yet
7,000 some builders are having difficulty finding
lots to buy! Owners are either tough (Lehman, Starwood),
6,000
or are completing entitlements (Blackrock).
5,000
4,000
3,000
2,000
1,000
0
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
4Q10
VDL
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25. Abacoa 4-mi. Radius Detached - All
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26. Abacoa 4-mile Radius Detached – active only
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27. Abacoa 4-mi. R adius Quarterly Starts v. M ove-
Ins of Detached Hom es
450
4Q10 starts: 27
400
4Q10 move-ins: 47
350
300
250
200
150
100
50
0
4Q10
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
Q sta rts Q move -ins
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28. Abacoa 4-m i. R adius Detached - Units Under
Construction v. Finished V acant Units
900
800 4Q10 fin/vac – 35
fin/vac M-O-S – 2.5
700
600
500
400
300
200
100
0
4Q10
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
U/C Fin Vac
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29. Abacoa 4-m i. R adius Detached - V acant
Developed Lots
1,750
1,500
1,250
1,000
750
500
250
0
4Q10
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
VDL
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30. Boynton/Delray 4-mi. Radius Detached -
All
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31. Boynton/Delray 4-mile Radius Detached – active
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32. Canyons 4-m i. R adius Quarterly Starts v.
M ove-Ins of Detached Hom es
600
4Q10 starts: 112
500
4Q10 move-ins: 138
400
300
200
100
0
4Q10
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
Q starts Q move -ins
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33. Canyons 4-mi. R adius Detached - Units
Under Construction v. Finished V acant Units
1,000
4Q10 fin/vac – 113
900
fin/vac M-O-S – 2.4
800
700
600
500
400
300
200
100
0
4Q10
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
U/C Fin Vac
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34. Canyons 4-m i. R adius Detached - V acant
Developed Lots
1,200
1,100
1,000
900
800
700
600
500
400
300
200
100
0
4Q10
4Q02
4Q03
4Q04
4Q05
4Q06
4Q07
4Q08
4Q09
VDL
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35. Foreclosures
Counties Committed to “Clean Out Backlogs!”
Robo-signers may benefit homebuilders
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36. Miami-Dade Foreclosure Filings and Certificates
of Title
Miami-Dade committed to "close out" 52,000 cases in the 12 months ended June 30, 2011.
8,000 -- That equals an average of 4,333 per month!
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
Nov-07
Nov-08
Nov-09
May-07
May-08
May-09
May-10
Jul-07
Jul-08
Jul-09
Jul-10
Mar-07
Mar-08
Mar-09
Mar-10
Jan-07
Jan-08
Jan-09
Jan-10
Sep-07
Sep-08
Sep-09
Sep-10
filings certs
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37. Broward Mortgage Foreclosure Filings versus
Certificates of T itle (Banks Only)
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
Jul-06
Jul-07
Jul-08
Jul-09
Jul-10
Mar-06
May-06
Mar-07
May-07
Mar-08
May-08
Mar-09
May-09
Mar-10
May-10
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Sep-06
Sep-07
Sep-08
Sep-09
Sep-10
Nov-06
Nov-07
Nov-08
Nov-09
Filings by Banks Certs into Banks
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38. P a lm B e a ch M o rt g a g e Fo re clo su re Filing s
ve rsu s C e rt ifica t e s o f T it le
3,500
3,000
2,500
2,000
1,500
1,000
500
0
Feb-06
Feb-07
Feb-08
Feb-09
Feb-10
Jun-06
Jun-07
Jun-08
Jun-09
Jun-10
Dec-06
Dec-07
Dec-08
Dec-09
Oct-06
Oct-07
Oct-08
Oct-09
Oct-10
Aug-06
Aug-07
Aug-08
Aug-09
Aug-10
Apr-06
Apr-07
Apr-08
Apr-09
Apr-10
Filing s Ce r t s int o Ba nks
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39. Brad Hunter
Chief Economist/
National Director of Consulting
(561) 573-8351
bhunter@metrostudy.com
THANK YOU!!
© Copyright Metrostudy 2010

40. About the Presenter
Brad Hunter, Chief Economist/National Director of Consulting
Brad Hunter spearheads Metrostudy’s current work with the investment
community and national developer/builder clients. A large part of his work
lately has been with private equity funds, hedge funds, and pension fund
advisors. He supervises the bulk of the company’s multi-market studies, and has
orchestrated hundreds of site-specific or area-specific housing market studies
over the past twenty-plus years. Metrostudy is the nation’s premier advisor on
local and regional housing market conditions. With 25 years worth of experience
in real estate analysis and local market economic forecasting, Mr. Hunter is a Full
Member of the Urban Land Institute, has authored numerous articles and book
chapters for ULI, including Market Profiles, and serves on the Housing Market
Forecast Panel for the Housing Market Report. He is regularly cited in local and
national journals, and has recently been featured in the Wall Street Journal and
on Bloomberg News (including Bloomberg’s “On the Money” and “On the
Economy” radio shows). He graduated in 1985 from the Wharton School of the
University of Pennsylvania with a degree in economics and has been a guest
lecturer at Harvard University. Hunter is a speaker at conferences on real estate
opportunities and investing, as well as at ULI conferences, and is frequently
called upon by key regulatory agencies of the U.S. government for his insights on
the housing sector. Hunter has tracked and forecast housing markets and
demographic/economic trends at the local level for 24 years.
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