Henderson Franklin was honored to sponsor 2021 Market Trends, which took place on March 9, 2021, with speakers Randy Thibaut, founder of Land Solutions, Inc., Denny Grimes, President of Denny Grimes & Team at Keller Williams Realty, and Stan Stouder, founding partner of CRE Consultants, LLC. The presentation discussed the real estate market over the last year in Southwest Florida. The following provides a summary of the event and what the speakers forecast the market to look like in the coming year. The report focused on three areas of the market: new construction, the resale sector, and commercial real estate.

Overall, 2020 saw sluggish growth in the first part of the year, as the initial stages of the COVID-19 pandemic injected fear into the market. The second half of the year saw tremendous rebounds in the residential sector. These rebounds were largely due to increasingly stringent and long-lasting shutdowns in Northern states, which brought thousands of new homebuyers to Southwest Florida.

New Construction Residential Market

In terms of the new construction market, 2020 saw an initial dip in the early part of the year, but, overall, the total number of new building permits amongst Lee, Collier and Charlotte counties increased an average of 16% across the board. Charlotte County saw the most growth with a 28% increase in new building permits.

Individual communities are also seeing tremendous growth. Leading the way in Southwest Florida was Babcock Ranch with 533 new building permits issued to various builders in 2020. However, prices for new construction, along with rent prices, rose throughout 2020, indicating that supply cannot match demand.

While 2020 was a volatile year in many respects, the new construction market in Southwest Florida saw growth consistently throughout the second part of the year. Look for that growth to continue into 2021, as increases in vaccine distribution will likely lead to a resurgence of both domestic and international tourism. While further growth is expected, it may be mitigated by Biden administration tax policies, rising interest rates, and the end of COVID emergency relief measures.

Resale Market

The re-sale market in Southwest Florida is hot. The final eight months of 2020 saw unprecedented levels of growth, although experts predict that the current levels are likely unsustainable over the long run. In 2020 sales of existing homes increased by 14% in Lee County and 27% in Collier County.

Within Lee County, the Bonita/Estero area led the way with a 25% increase from 2019 to 2020. While impressive, those numbers do not reflect the whole story. From July 2020 to January 2021 Bonita/Estero saw a 58% bump in home sales from the prior year. With such a hot re-sale market it is hardly a surprise that inventory of re-sale properties is currently low.

In Lee County, there are currently only nine residential properties on the market under $100,000.00 and only 38 properties in the $100,000.00-150,000.00 price range. In order to make up for this deficiency, experts suggest constructing new homes, renovating existing homes, along with identifying shadow sellers who could be potential sources of new inventory.

Commercial Property

The commercial market is perhaps the most stable sector of the market over the last year. The effects of COVID both positively and negatively affected the market. For instance, the cost of building materials increased throughout the pandemic, which in turn increased construction costs. However, COVID emergency relief measures such as the PPP loans, and SBA loans injected approximately two trillion dollars into the U.S. economy. Similarly, interest rates are at their lowest since 2008– the prime rate currently sits at 3.25%. These factors resulted in both highs and lows depending on the subsector of the market.

Retail commerce is up 44% in 2020, however much of that commerce came via internet retail outlets like Amazon. This shift to online retail affected the market for retail properties. In 2020 the sales of retail properties decreased by 17% from the year before. Within the retail subsector, restaurant properties should be approached with even more caution, as some national dine-in chains closed the doors to many locations. However, local restaurants, delivery services, or medical facilities have started backfilling those vacant restaurants.

In the office subsector, 2020 saw a 21% decline in purchases of office space. This is not a surprise due to many businesses operating remotely throughout the pandemic. However, experts predict that the year-long pandemic has employees looking forward to returning to the office and should see the office sector returning to stable levels.

In contrast, the industrial sector saw the most growth throughout 2020. Currently, there is a large volume of inventory for commercial tenancies, while there is little to no commercial properties to purchase. Experts suggest developers build commercial properties for sale to generate additional inventory. Unlike the retail and office sector, industrial properties saw a 61% increase in sales from 2019 to 2020, which explains the lack of inventory. Overall, the commercial market is solid going into 2021.


The Market Trends report this year was heavily focused on the impacts of COVID-19, which is not surprising considering the widespread impacts the pandemic has had across all industries and communities. While the pandemic still continues to pose challenges throughout the country, including for Southwest Florida, the pandemic perhaps expedited the growth of the region and created even greater opportunities for development in 2021.