As commercial loans slow slightly due to rising interest rates at financial institutions, commercial health loans are becoming a growing market in South Florida thanks to the growing number of licensed doctors and Florida’s growing population.
City National Bank is adding a medical department to its private banking lending options in response to the significant increase in medical, dental and veterinary practices in Florida.
“This is a growing market for us. We believe that being able to work with these doctors, dentists and veterinarians in their financial situation is important, not only for the bank but also for the community, ”said Ricardo Garbati, director of private banking at the city’s National Bank.
The need for commercial medical loans is growing in the region, he said. “What we see most often are requests for practical acquisition [loans] for physicians who wish to expand their practice, either by purchasing an existing practice or by merging with other practices. We also see that many general practitioners are evaluating the possibility of starting their own practice ”.
The bank’s new division will also seek to cover medical practice financial planning, equipment financing and commercial real estate investments for private physicians, dentists, veterinarians, diagnostic centers and outpatient facilities.
Five professionals join CNB’s Private Medical Banking Group, including Frank Nogareda as Senior Vice President; Shaina Mejia and Gerson Sotolongo as Vice President and Private Banking Relationship Manager; Leniel Rendon as vice president and director of sales in financial management; and Adriel Martinez as a Senior Customer Service Specialist.
According to Florida Health’s 2021 Annual Physicians Workforce Report, the number of treating physicians in Florida has increased by 24.6% over the past decade, while the population of Florida has grown by 13.5%.
“The main factor driving this growth is the large outflow of people in Florida in general, the demand from high-income individuals who have settled in South Florida, and the income growth our resident market has seen,” stated Mr. Polite. “The demand for qualified medical care … has led to the growth of this field.”
Growth can be seen evenly across South Florida, he added, “with large hospitals acquiring talent from across the country, large dental practices acquiring smaller dental practices, and doctors looking for the opportunity to go it alone. and be more at ease “. finances are for a practice owner.
In addition, other trade credit markets have calmed down slightly. “Florida continues to be hot and showing growth, but the transaction volume has slowed slightly,” she said. “We attribute this to rising interest rates, but we continue to see a strong buyer group [of commercial real estate] as people continue to move to South Florida and other areas.
Pablo Pino, Director of Market for Commercial Banks in South Florida at TD Bank, said commercial lending is outpacing pre-pandemic volumes, although it is stabilizing in a number of sectors due to rising interest rates. interest and inflationary costs.
Customers seeking trade credit are looking for additional working capital, he said. There is demand for commercial loans for all-out equipment, mortgage loans, and treasury management services. “They buy equipment and consider whether to buy it [real estate]compared to rents ”as rents have increased.
There is something to catch up in the hotel industry, he said; also in food distribution, consumer goods, nutrition and vitamins, the aerospace industry, automotive distribution and auto parts. “There seems to be a pent-up demand from the pandemic,” Pino said. “Many held back”
Manufacturing and distribution companies purchase their raw materials in bulk to ensure they have the materials needed for their production, he added. “Maintaining more inventory requires more working capital.”
With the return to traditional business in the office environment, Pino said, companies are adding the technology they implemented during the pandemic to their core business.
“We expect this [the medical division at CNB] it will continue to grow and the demand for world-class healthcare will not change, “said Garbati.” Migration to South Florida has been different than in years past. With people enrolling their children in schools and becoming more and more involved in the community, we believe the medical side of the market will remain an area of growth for years to come. “
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