In the second quarter, warehouse landlords across South Florida maintained a strong position as median asking rents soared, particularly in Miami-Dade and Broward counties. According to a recent report from JLL, Miami-Dade saw a 9% increase, while Broward experienced a notable 17% rise compared to the same period last year. Meanwhile, Palm Beach County's rents remained relatively steady.
The tight market conditions were underscored by vacancy rates below 4% across all three counties, indicating robust demand that swiftly absorbs newly available industrial spaces.
Palm Beach County Overview
Palm Beach County saw a modest increase in median asking rents to $14.70 per square foot, up from $14.07 last year. The vacancy rate edged up to 3.9% from 3.7% a year ago. Lease signings totaled 230,000 square feet, including renewals, while 1.5 million square feet of new warehouse space was under construction. The Parts House secured the largest lease for 26,002 square feet at Landmark Commerce Center in West Palm Beach.
Foundry Commercial and Wheelock Street Capital expanded warehouse offerings in Palm Beach County with the announcement of Egret Point Logistics Center, a $52.3 million project featuring two industrial facilities in Boynton Beach.
Broward County Insights
In Broward County, median asking rents surged to $16.18 per square foot, compared to $13.88 a year ago, with a stable vacancy rate of 3.2%. Notable transactions included Compass Group USA leasing 69,697 square feet in Miramar. Despite minimal new construction due to limited available land, Tishman Speyer's acquisition of Rock Lake Business Center for $100.7 million in Pompano Beach marked a significant investment.
Miami-Dade County Highlights
Miami-Dade County's industrial market witnessed a rise in median asking rents to $17.42 per square foot, up from $16.06 last year. Despite a slight increase in vacancy rates to 2.3%, from 1.9% the previous year, leasing activity remained strong with 1.6 million square feet leased. Significant developments included MD Turbines Holdings' lease of 178,201 square feet at Countyline Corporate Park.
Additionally, East Capital from Darien, Connecticut expanded its presence in Medley by acquiring eight warehouses and a storage yard for $17.5 million during the quarter.
Market Dynamics and Investment Activity
The second quarter also witnessed substantial transactions involving national players in the commercial real estate sector. Hillwood, owned by Ross Perot Jr., invested $106.5 million in a Jupiter distribution facility leased to Amazon. Property Reserve, affiliated with the Mormon Church, acquired a Hialeah warehouse for $56 million, reflecting strong investor confidence in South Florida's industrial market.
Conclusion
With landlords maintaining control amid rising rents and low vacancy rates, South Florida's industrial real estate market remains a hotspot for investors and tenants alike. The surge in leasing activity and strategic acquisitions by major entities underscore the region's appeal as a prime location for industrial growth and development.
For stakeholders navigating the dynamic landscape of South Florida's industrial sector, staying informed about evolving market trends and investment opportunities is crucial in capitalizing on the region's thriving commercial real estate environment.
Posted by Larry Mastropieri on
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