The Villages Daily Sun

Top of The News Local Economy to See Billions in Growth

The addition of 14,000 homes will create more jobs and opportunities for residents and those who retire here.

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Posted: Tuesday, May 16, 2017 6:00 am | Updated: 2:35 pm, Wed May 17, 2017.

Billions of dollars.

That’s what the recently announced Villages developments are projected to bring to the local economy.

So much economic opportunity for residents and workers has been created over the past couple decades as The Villages grew from humble beginnings.

It may pale in comparison, however, with the addition of the 14,000 homes The Villages Developer is planning to build on 8,000 acres south of State Road 44 in and around the villages of Fenney and

Southern Oaks.

The potential impact of these homes means billions of dollars in immediate economic impact, judging from a review of Sumter County property values and several other key economic indicators.

No question the county’s economic future looks bright with this expansion, said Terry Yoder, chairman and CEO of Wildwood’s T&D Family of Cos., one of The Villages’ leading construction subcontractors.

“It’s a lot of money,” he said.

What pleases Yoder is the opportunity through this expansion to create jobs that easily will keep his workers employed for more than a decade.

“I have to admit I was getting worried around July last year as we were nearing buildout north of SR 44,” he said. “When I heard about the expansion, it took a tremendous burden off my heart, because of the effect that buildout would have had on my families. Now, the future of Sumter County looks very positive for anyone who would want to relocate to work or retire here.”

Favorable Growth

The potential impact of this expansion on The Villages metropolitan statistical area, which includes all of The Villages in Sumter but not Lake or Marion counties, can be projected by looking at the growth over the last decade.

Over the past several years, the MSA’s gross domestic product grew at a healthy rate of about 12 percent.

The value of goods and services produced within the MSA, including the development and sales of homes in The Villages, exceeds $2 billion per year.

Homes sold at an average price of $312,000 each in The Villages in 2016, Citigroup researchers concluded in a prospectus published in April as part of the $26 million municipal bond refunding in Village Community Development District 6.

Not counting factors such as inflation and price appreciation, the value of 14,000 homes at $312,000 a piece would produce an immediate economic impact of nearly $4.4 billion.

That total value would include the dollars spent to employ thousands of workers and scores of construction companies that also spend big money on goods and services within The Villages MSA.

Wages paid to those workers, for instance, multiply as they spend dollars on lunches and other needs and conveniences within The Villages, as well as money that goes to pay mortgages, rents, car payments, insurance and other costs in their home communities.

The potential economic impact even emerged as a line item in a recent ratings report issued by Fitch, a national bond ratings service.

In the May 4 report, Fitch upgraded Sumter’s industrial revenue and general revenue bonds to AA+ from AA-.

“Revenue growth prospects are favorable, driven by development projects planned and underway,” the ratings agency reported.

The anticipated growth south of SR 44 also should have a substantial impact going forward on commercial developments such as the Brownwood town center and Lake Deaton Plaza neighborhood retail center, Sumter County Administrator Bradley Arnold said.

“It’s going to create demand for the retail space that’s available,” he said. “With the planned Buena Vista Boulevard extension to the Village of Fenney, that will push customers to Brownwood. So, we will see the full buildout of Brownwood.”

Years of Impact

Several key economic indicators support the contention that the expansion south of SR 44 could have a tremendous impact on the local economy.

From 2009 to 2016, for instance, the average sale price of homes increased by 36.2 percent to $312,000, according to the Citigroup review.

The total for just residential and commercial property values increased by 58.3 percent from 2009 to 2016 in Sumter County, almost exclusively because of development within The Villages, according to the Florida Department of Revenue. Just value totaled nearly $14.3 billion in 2016, up from nearly $9.5 billion in 2009.

The residential and commercial activity resulted in a 91.3 percent increase in Sumter’s gross sales during the same time period, according to state data. Gross sales totaled nearly $3 billion in 2016, compared with slightly more than $1.53 billion in 2009.

Consequently, collected Sumter sales tax increased by 78.1 percent during the same time period, state records showed. Sales taxes collected totaled slightly more than $80.4 million in 2016, compared with nearly $45.2 in 2009.

All of this economic activity produced a 93 percent increase in jobs from March 2009 to March 2017, according to data compiled by the Florida Department of Economic Opportunity and the federal Bureau of Labor Statistics, as published by the U.S. Census Bureau.

There were 28,300 Sumter residents employed in March 2017, up from 14,695 during the same month in 2009, the data showed.

So, the impact of 14,000 new homes could be considerable, Sumter County Property Appraiser Joey Hooten said.

“It’s a positive impact that we won’t truly understand for years to come,” he said.

The real impact will be on young people who are graduating from high school and college and entering the workforce, Hooten said.

“When you consider the actual revenue coming into the county, it’s a win-win situation all the way around,” he said.