Hertz move should boost housing market, local economy

Hertz relocating to Estero

Gov. Scott, Hertz CEO announce relocation.

— Hertz’s move to Estero will bring more house hunters to Southwest Florida.

With the relocation of its worldwide headquarters from Park Ridge, N.J., the rental car giant, Hertz Global Holdings Inc., plans to move at least 700 jobs here. That means hundreds of potential buyers for a housing market recovering from a boom-gone-bust.

“This is certainly the kind of news the state of Florida, particularly Southwest Florida, is looking for,” said Denny Grimes, a Realtor with Denny Grimes & Co. at Royal Shell Real Estate in Fort Myers. “It’s not going to basically send our real estate market into orbit. Not all 700 people will need a house. Some may rent, but the domino effect of this relocation is very important to the economy of Southwest Florida, which will drive the housing market.”

The move sends an important message that will bring many economic benefits, he said.

“What it’s doing is showing Florida is open for business,” Grimes said. “Southwest Florida offers water, warmth and a way of life and we are open to business — and it’s an economic shot in the arm for the housing market, and for the psyche of our area.”

The Hertz relocation is expected to give Lee County a $190 million economic boost each year after it’s completed in 2017, a Florida Gulf Coast University study shows.

“The overall impact is much bigger than the 700 jobs,” said study author Gary Jackson, director of the Regional Economic Research Institute at FGCU’s Lutgert School of Business.

The local economy will get a bump from companies doing business with Hertz and from Hertz’s employees spending money at restaurants, retail shops, grocery stores and other service businesses, from hair dressers to dry cleaners.

The study projects the Hertz relocation will spin-off another 1,000 jobs in Lee County alone, said Christine Ross, executive director of the Bonita Springs Estero Economic Development Council. “It’s dramatic and it will be across the board,” she said.

Jim Wall, communications director for Southwest Florida Works, which connects employers with job-seekers, points out that Hertz’s jobs will be year-round, unlike many of the area’s other service jobs that are seasonal.

“That’s a big, big step toward the economic stability of Southwest Florida,” he said.

Public coffers also will benefit, with the construction of Hertz’s new headquarters generating $2.3 million in state and local sales taxes and increasing property tax revenues by $4.6 million, the FGCU study shows.

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Lee County asked for the study, without revealing Hertz’s identity, as it considered whether to provide more than $4 million in incentives to the then-mystery company to move its corporate headquarters and up to 700 jobs by 2016.

Even if 700 employees purchased homes it would be “a drop in the bucket when it comes to the real estate market,” but the spillover will be “exponential,” Grimes said.

“You don’t win the Super Bowl in one game,” he said. “It’s a series of wins and this is a win for our area.”

The move is sure to grab the attention of other big-named companies that are considering relocations, or expansions, Grimes said.

“When you see Estero listed on corporate press releases, on mailing addresses and websites, people will scratch their heads and say, ‘Where is it?’ It helps to geographically locate Southwest Florida. They will want to know where it is.”

In his blog, Bob Pisa, a Realtor with Downing-Frye Realty Inc. in Naples, touts the Hertz relocation news by saying, “First Dunk City, Now Home for Fortune 500,” referring back to the publicity created when the men’s basketball team at Florida Gulf Coast University in south Lee County made it into the Sweet 16, turning the nation’s attention on the college and town. He expects Hertz’s move to create housing demand in both Lee and Collier counties.

“Certainly, the North Naples area is within striking distance of the new headquarters,” Pisa said.

While it will take some time to build the new headquarters, he said, it would make sense for Hertz employees who are relocating to buy now, with prices on the rise and builders unable to keep up with current demand.

“New-construction lead times are kind of long. They are anywhere from 5-1/2 to 12 months for new construction. And that is for a standard home,” Pisa said.

The home inventory in Southwest Florida is at one of its lowest points in years, with demand rising, he said.

Hertz employees, like any other buyers or renters, will look at various factors in deciding where to live, including schools, recreation and amenities, said Mike Timmerman, a senior associate for economic consultants Hank Fishkind & Associates Inc. in Naples. He expects old and new communities within 10 miles of the headquarters to benefit most.

The corporate employees moving here will earn an average of $117,000 a year, including benefits, so they’re people who can afford to buy homes — and more expensive ones, said Phil Wood, president and CEO of John R. Wood Realtors Inc.

“That’s huge,” he said. “And that’s really good news.”

He expects to see the employees buy in Naples, Fort Myers, Bonita and Estero.

“It will have an excellent, positive impact on the overall market,” he said. “This will be a significant number of permanent buyers.”

__ Staff writers Eric Staats and Jenna Buzzacco-Foerster contributed to this story.

© 2013 marconews.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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