County Center a financial anchor for Hillsborough

It was a pleasure to read the letter about not selling the County Center by Justice Fred Karl ("The wrong time to sell the county center," Views, July 10). He, in his very nonconfrontational way, lays out his position with background and facts as to why those in charge should not sell the building.

As usual, his comments and facts were right on target.

I wish to support Karl's argument but from a different perspective, that of a commercial Realtor.

I am involved in the practice of commercial real estate every day, and I wholeheartedly agree with Karl that this is not the time to sell the County Center.

The commercial real estate market, like every other market, is affected by the economy. Our cycle is 12 to 24 months behind the residential market. The financing of commercial real estate is typically done in the arena of community banks, and the mortgages are usually three- to five-year balloon notes. That is not to say that large financial institutions, REITs and individuals do not finance commercial loans.

In the next one to three years, $1.2 trillion of commercial real estate loans with balloon mortgages will mature with very limited options to refinance. For commercial borrowers who are making their monthly payments, a simple term extension or workout in lieu of a refinance would make perfect sense.

However, lenders are not currently offering loan modifications, due to pressure from bank regulators.

Anecdotal evidence suggests that regulators continue to encourage lenders to write down the value of performing loans and, in some instances, even call the loan if the current value of the property is less than the loan balance.

This practice has further exacerbated the economic downturn by creating defaults in properties that were able to meet, and did meet, their debt-servicing obligations.

Bureaucratic red tape only adds more distressed properties to the already large toxic inventory.

History has proven that the real estate market is cyclical. In the past four years, the property values across the country have fallen about 40 percent. Some pockets have experienced a more severe downturn, while in others it was less severe.

We are currently experiencing in the Tampa market an excess of office inventory. Building owners are having to reduce rents to keep tenants in their locations or offer incentives to attract new tenants.

This will only improve with new jobs and a growing economy, which leads to my final point.

If Hillsborough County is to remain a center to attract new businesses, new investments and new people, we must refer to the old saying, "You only get one chance to make a good first impression."

The County Center building is impressive, functional and will rate at the top of the list, when compared with any other government building in Florida.

If we are to work ourselves out of this economic downturn, we need all the resources we can muster, including an attractive venue. The County Center serves that purpose and will prove to be the financial anchor that holds our local government together.