CSX rail hub in Lakeland / Winter Haven, FL, a game changer?

Question

I just recently listened to the Jonathan Twombly podcast (#172) and at the end he mentions the value of logistics centers to real estate value in which "the mode of transport changes from one form to another." It creates heaps of jobs and housing demand.

The inland logistics port in Winter Haven (Polk County) just opened in 2014 and is close to St. Petersburg, Tampa, Lakeland, and Orlando. To those that are in the area, has this been the juggernaut it seems to be? Has the market already adjusted and it's too late to come to this party? I am curious to know the opinions of the veteran investors in the area. I don't live in the area yet, but this seems like a huge deal.

John Rogers · Answer

What has proved interesting "locally" (I live near the interchange of Rte. 4 and Rte. 27) the main North South route in CENTRAL corridor.) There has been a major expansion of Rte. 27 up through Polk, Lake, and North as well as South through Highlands county. This has created a parade of tractor trailer traffic.

The growth @Adrian Smude was talking about is in warehousing... Huge complexes are underway at the interchange as well as spreading both East (which is difficult because of Disney) and west toward Tampa where almost every major interchange off Rte. 4 is now sprouting up warehouse complexes.

Is there housing growth?  Yes... but the opportunity is more in line with buy & hold rentals for the workers.

We do HUD homes for investors and they can't flip them fast enough...

Jeff Copeland · Answer

While it may have had a local impact on warehouse and distribution jobs, I was not even aware of it in Tampa/St Pete - so the regional impact was non-existent.

Transportation-wise, I personally think the ferry project between the Southshore area and Macdill AFB (if it ever gets underway) will have a tremendous impact on the Brandon/Ruskin/Riverview area in both the rental and resale markets.

These are already high-growth areas and a major transportation link to the base would add a lot of fuel to the fire.

But it's years away, at best.

Adrian Smude · Answer

@John Rogers as always very good info!

Huiping S. · Answer

Paul Winka,

Happy to know you visited other places and the fast train. The port itself definitely will be a good thing for this area jobs and real estate. The truck service from port is very heavy on this area. Lots new apt and residential constructions in this area.  So much new construction and I don't know how to explain the chance for typical REI who buy problems properties.

Paul Winka · Answer

I agree after experiencing the speedy passenger trains in Shanghai and Japan that these CSX trains are really slow. But do you think the port itself is a boon to the area for jobs and real estate?

Huiping S. · Answer

I have to change my way to office to avoid CSX's last century train system. Globally I doubt how many countries still use so slow train and to block the main traffic few times day. Without analysis the poor designed system to block major traffic, just see the last century speed of CSX train, I think this will have good impact on this region only if the speed can catch-up this information century. Now, it is impossible.

Adrian Smude · Answer

@Paul Winka the Polk County area along I4 still has affordable housing for people; these people can easily get on I4 and work in Tampa or Orlando so they won't have to move because of job change.  This is besides all the jobs locally.  Polk county isn't typically the big shinny object like Miami, Tampa, St Pete etc so we get less investors bidding up the prices (but let's keep that between us ;-) ). Another big reason is I live in Plant City and plan to stay here, and I don't want to drive more than 30 minutes for a tenant.  I love Brandon Riverview area that @Jeff Copeland gave great insight about, but at this moment I haven't put much focus there because of the competition.  I just haven't seen many/any deals that look amazing. Once we get our next pull back I'm sure I'll be buying over there again.

Paul Winka · Answer

@Jeff Copeland

Too bad about the ferry project getting delayed. I found this Best Buy Cities: Where to invest in housing and was happy to see Tampa was high on the list for 2016. Is this a surprise to you, or is this just someone making armchair speculations from a desk a thousand miles away?

Paul Winka · Answer

@Adrian Smude

What are the other reasons you choose Lakeland and Winter Haven then? In Plant City you are equally close to Tampa too, so I figured there is a reason.

Adrian Smude · Answer

@Paul Winka I've liked Polk County for these reason, but I don't chase things like this.  I let it build to my reasoning of liking the area.  Lakeland-Winter Haven area has many warehouse style jobs and is in a great location on I4.  These are a few of the reasons I have rents here and I am actively looking for more.

CSX rail hub in Lakeland / Winter Haven, FL, a game changer?

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