South Florida didn’t seem like a strong market anymore during the recession. Construction on high-end condos had abated, with many structures left unfinished scattered around Miami.
That has changed, and now the market has improved tremendously because of revitalized population and job growth because people will always want to live in that locale.
As Colliers’ fourth-quarter reports come in about various markets, we are finding that the news largely remains good in this region of the state.
On the retail front, Miami did take a bit of a vacancy rate hit in the fourth quarter, with a 40-basis-point increase year over year over the period. However, activity in the Miami-Dade area was very strong during 2016’s other three quarters.
Just to the North, Broward County saw vacancy rates drop to 4.9 percent from 5.5 percent. And for the full year, asking rents ticked up by seven percent, hitting in excess of $20 per square foot. Meanwhile, Palm Beach County is doing extremely well on the retail front, and Colliers points out that it is the area’s strongest run in about a decade. Net absorption was at its highest since 2006, hitting one million square feet around the area.
Office also seems to be strong as well in South Florida. There were reportedly $1 billion in office transactions over the year, Colliers says.
In Broward County, net absorption in the office market hit one-million square feet over the second half of the year, while vacancy rates dropped by 140 basis points. A cap on new office development there has helped push up occupancy.
And just as it was with retail, Palm Beach County has done well in the office arena, due to increasing development and hiring in the area.
So, in those two sectors, things are looking good in South Florida.
On top of that, South Florida industrial real estate might be on even more of a tear. Colliers calls the Miami-Dade market among one of the strongest in the country, sporting a four percent vacancy rate. The nearby counties are doing well, too. Broward saw 2.5 million square feet of absorption during the year, and because of such a tight market, owners are looking toward Palm Beach for more space options.
The days of the recession are surely over in South Florida. There is no reason to think that this market will slow down in a big way any time soon if the overall economy stays strong.