Bob Harrington, Vice President, Northmarq
In an interview with Invest:, Northmarq Vice President Bob Harrington talked about the firm’s achievements in the Miami market, highlighting increased transaction activity and optimism for 2025 despite challenges such as high interest rates and insurance costs. Harrington emphasized the importance of adapting to changing market conditions, particularly in sectors like office, industrial, and multifamily housing.
What have been some significant achievements for Northmarq in the Miami market over the last year?
Reflecting on the past year, we saw a small uptick in transaction activity and production — but that was true for the industry as a whole, not just our firm. However, there is definitely more momentum and a lot of optimism in the first quarter of 2025. It seems like every transaction has become a bit tougher to close lately, so we don’t take them for granted, especially given how volatile the capital markets have been. Our clients are really looking to us for advice and relying on the depth of our platform to come up with solutions that will fill their needs. It used to be easier to identify the types of capital sources that would provide financing, but these days, we need to cast a much wider net.
What have been some of the biggest pain points over the past year?
Especially in Florida, the biggest pain point has been the cost of insurance. We are starting to see a little relief in this area, and the insurance brokerage community is getting more creative in how it assists our clients. We are turning a corner, but high insurance costs remain the biggest challenge, aside from high interest rates. Now that we’re through the election cycle, there is a hope that things will settle down (or at least stabilize) and that transaction volume will continue to increase.
What climate-focused initiatives is Northmarq pursuing, and how are you addressing the region’s ongoing challenges with hurricanes and infrastructure?
We were fortunate with the last two storms, especially with Hurricane Milton, which could have been much worse had it not decreased in strength as it made landfall. Climate change will continue to be a major issue in South Florida, especially when a normal summer rain can still cause significant flooding. It’s not something we necessarily have all the answers to, but we are looking to facilitate conversations about it and make changes where we can, especially in the projects we undertake.
What key trends are you observing, and how is Northmarq positioned to respond to these developments?
In terms of office space, we’re continuing to build new office buildings, which is a testament to the businesses and people moving to the region. Office space has had a bad reputation post-COVID, but the fact that Miami is still adding new office buildings shows how much demand there is for people to live and do business here.
Our industrial market remains strong, given that we’re a hub with Miami International Airport and cargo shipping through the Port of Miami. The biopharma and tech sectors are also thriving. Multifamily housing remains strong, though the biggest issue there is affordability. There has been some recent legislation, such as the Live Local Act, aimed at addressing this, but we haven’t yet seen the full benefits of it. Nonetheless, it’s something that is on everyone’s radar.
Do you think the new federal administration will alleviate some of the challenges in real estate?
I think, in general, the real estate sector is optimistic about what lies ahead. Whether or not the federal administration has a direct impact on interest rates remains to be seen, but in terms of sentiment, there is a positive outlook that will hopefully encourage people to transact and create some organic growth.
How are inflation and interest rates shaping Northmarq’s strategies for Miami-based investments?
We’ve certainly seen short-term rates come down, which is affecting housing rates and floating-rate borrowing costs for our commercial and multifamily borrowers. We’re at an inflection point where we’re engaging with our clients to help them put together the best solutions. It’s a balancing act between solving short-term issues versus maintaining a sound long-term strategy, and we’re working that into the solutions we provide.
What recent transactions or projects highlight Northmarq’s approach to value creation for clients?
We finance multifamily projects, including new construction and lease-up developments, as well as distressed opportunities as they present themselves. We recently closed on a cold storage industrial building near the airport, which is a significant industry in the area. About 90% of the flowers and 65% of the fish that come into the United States pass through our airport, so it’s a mission-critical location. We were able to advise on that project and help make it a success. We’re very active across many sectors, utilizing the area’s resources for various projects.
Looking ahead, how do you plan to adapt your approach to maintain resilience amid economic shifts and market transformations?
We’re bullish on Florida and South Florida. We’ve shifted our approach to how we use office space here. We have offices in Miami, Fort Lauderdale, and West Palm Beach, giving us a presence across the tri-county area. We certainly see opportunities for growth, and our clients are continuing to invest, whether they are local or coming from other parts of the country, often referred by others or after seeing firsthand how much Florida is growing. We are here to be the boots on the ground, facilitating smart decisions, and making sure our clients are executing sound transactions.
