When commercial real estate investors look at investing in places like South Florida, you’ll be sure to notice that sense of untapped potential which constantly lingers in the air. South Florida’s commercial real estate markets have been in demand the past two years.
Collier’s latest research report has highlighted some Notable Deals in the area: Burlington Coat Factory signed a 50,000 SF anchor lease at the new River Landing project. Aldo Group, the Montreal-based shoe store company, purchased a retail building at 635-639 Lincoln Road for $35 million or a whopping $6,560 PSF in January 2016. Also, New York based JSRE Acquisitions paid $35 million for an entire retail block (21,358 SF of retail space) along Northwest Second Avenue in the popular Wynwood submarket.
Additionally, in Coral Gables, the $119 million Alhambra office complex has been brought to light for real estate professionals and investors. And in Miami, Lincoln Road’s retail assembly went for $370 million. The Miami-Dade area has been poised for even more growth to continue in 2016, with having 25 buildings presently under construction. The new construction will create over 2 million SF of new retail space in Miami-Dade. In Broward County, tremendous decline has been seen in vacancy rates and rent growth, having reached its peak since 2009, according to Collier’s. The report also indicated that in 2015, over 1,000,000 SF of new retail inventory was delivered to the market. Presently, 517,419 SF is under construction in the area, thanks to growing population, expanding tourism and job growth.
Collier’s also indicated that in Miami-Dade, 2016 started out with strong countywide rental rate growth; in particular Class A asking full service rental rates climbed to an estimated $40.21, up 1.5 percent quarter over quarter. Approximately 87 percent of the new development is located at the Brickell City Centre.
Notable Office Deals: The 23-story Courthouse Tower in Downtown Miami traded to New York-based Brickman for $27.5 million or $169 PSF. TA Realty sold Doral Costa office park for $74 million or $263 PSF to Miami-based Triarch Capital Group in March 2016. After signing a 110,506 SF lease in early January 2016, one of the nation’s top law firms, Akerman, moved into the 12-story Three Brickell City Centre tower as the primary anchor tenant. However, a trend of signed leases in the first quarter of 2016 have been notably smaller in size and the pace of total office leasing activity slowed thus significantly reducing absorption levels. There is also more sublease space on the market compared to recent periods.