Community Banking Fuels Multifamily Growth in South Florida’s Changing Market

Written by:

Steve Marcinuk

Date:

21 Jan 2026

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South Florida’s real estate market remains a magnet for investment, even as national conditions tighten. Community banks play a pivotal role in financing development projects that larger banks often overlook. Centennial Bank’s recent $73 million-plus construction loan for the 341-unit Flamingo Village in Hialeah illustrates how relationship-driven lending is enabling new projects in areas previously underserved by institutional capital.

Building Relationships to Drive Development

Centennial Bank, headquartered in Conway, Arkansas, operates in multiple states but maintains a strong local focus in its commercial real estate lending. J.C. de Ona, Division President for Centennial Bank’s Southeast Florida region, oversees a portfolio stretching from Palm Beach County southward.

“We have the capabilities of the largest banks, but we pride ourselves on personalized service and individualized relationships with business owners and developers,” de Ona says.

This relationship-based approach has been efficient in South Florida, where long-term partnerships have sustained consistent deal flow even as broader market volatility has intensified. The bank’s ongoing collaboration with Prestige Companies, Hialeah’s largest developer, highlights the advantages of sustained engagement in navigating complex local markets.

Revitalizing Hialeah’s Multifamily Market

Flamingo Village is more than another large apartment project. Built on 13 acres next to the historic Hialeah Park and Casino, the 341-unit community is the first significant multifamily construction in the area since the 1980s.

“Hialeah hadn’t had a new multifamily project since the 80s until we started working with them around 2010,” de Ona says. “Since then, we’ve done a range of projects there; studios, one, two, and three-bedroom units. They’ve all been very successful.”

The site’s proximity to a metro stop provides direct access to downtown Miami, the airport, and major employment hubs. Combined with Hialeah’s historically high occupancy rates, this location offers strong fundamentals for multifamily investment.

Conservative Lending in an Uncertain Economy

Many developers have struggled to secure construction financing amid rising costs and economic uncertainty. Centennial Bank has maintained steady lending activity by sticking to conservative underwriting standards.

“We’ve always stayed in our lane and never tried to be overly aggressive,” de Ona says. “Our underwriting is robust. We stress-test everything: rental rates, interest costs, vacancies, and operating expenses.”

Centennial Bank does not underwrite loans based on assumed rent growth; instead, it uses current market rates as the basis for underwriting. “We often see proposals with today’s rent at $3 per square foot and projections of $3.25 by delivery. We stick with $3, because that’s what the market supports now,” de Ona explains.

The bank also requires significant contingencies for construction cost overruns and encourages developers to lock in subcontractor pricing early to manage material cost volatility.

Adapting to Market Headwinds

The multifamily sector in South Florida has faced rising construction, financing, and operational costs in recent years. These pressures have led some developers to shift from rental projects to condominiums, where buyer deposits can be used as equity and sales revenue realized sooner.

“There was a period when projects planned as multifamily rentals shifted to condos because the numbers worked better,” de Ona notes. “If demand is strong, those buyer deposits help fill the equity gap.”

Still, projects with reasonable land costs, adequate equity, and experienced teams continue to attract financing. The tighter environment has also opened the door for debt funds to compete with banks, usually at higher interest rates and fees.

Wealth Migration Reshapes Demand

South Florida’s post-pandemic influx of new residents and companies has changed real estate demand patterns. The region is seeing not just individuals but entire firms relocating their operations, fueling sustained demand for both residential and commercial space.

“Miami changed forever,” de Ona says. “We’re seeing not just people, but large companies moving here. Now, one of the biggest challenges is providing enough schools for all the new families.”

This corporate migration creates a ripple effect. “It’s a gravitational pull,” de Ona explains. “When a company moves here, their business partners, vendors, and clients often follow.”

Addressing Affordability Pressures

The influx of wealth has driven up housing costs, creating affordability challenges for long-term residents. In response, there is a growing emphasis on workforce housing and affordable housing. Florida’s Live Local Act, which incentivizes affordable housing development, has gained traction among developers.

“Last year, I saw more projects with an affordability component, sometimes 10%, 20%, or even the entire project,” de Ona reports. “We can’t just build luxury condos and ignore the need for housing that most people can afford.”

Centennial Bank is actively financing affordable housing, including a project with the Hialeah Housing Authority. However, de Ona notes that coordinating Live Local benefits with agency requirements for permanent financing remains complex and sometimes slows project timelines.

Current Market Activity and Outlook

Despite economic headwinds, de Ona is optimistic about continued development in South Florida. Residential projects, both traditional multifamily and mixed-use, dominate the pipeline, alongside high-end condo developments.

“We had a strong year last year, and I expect another strong year ahead,” he says. “When there’s uncertainty elsewhere, people see South Florida as a stable place to invest and live.”

Demand remains strong across asset classes. Luxury spec homes selling for $100 million share the market with workforce housing developments, reflecting South Florida’s shift from a seasonal destination to a year-round hub for business and residents.

The Community Bank Advantage

Centennial Bank’s continued success highlights the value of community banks in real estate development. By combining the resources of larger institutions with local market expertise and personalized service, community banks can serve developers who might not qualify for funding from national lenders.

“Our legal lending limit allows us to participate in large projects,” de Ona says. “We know the market well, and that gives us an edge over some bigger banks that lack a local presence.”

As South Florida’s population and economy continue to grow, the partnership between experienced developers and relationship-driven lenders like Centennial Bank will be essential for meeting diverse housing needs. By maintaining careful underwriting and supporting a range of development types, from luxury to affordable, community banks are positioned to help shape the region’s future while managing risk for both borrowers and the bank.

In an environment where market fundamentals are changing rapidly, the consistent presence of community banks provides stability for developers. It ensures that a broad range of housing projects can proceed, even as larger institutions scale back. This approach is helping South Florida adapt to new demographic realities and maintain its appeal as a place to live and invest.