A new market survey published by Reis Reports Inc., a New York-based commercial real estate research group, attributes the increase to demand from foreign and domestic investors that view the Broward County market as affordable and supported by effective transportation infrastructure.
"Keeping the market a hotbed of activity is the construction of I-595, which has improved roadway and market access from western Broward County and downtown Ft. Lauderdale to Miami-Dade and the rapidly expanding area of Miami International Airport," according to the report.
Although each submarket would vary greatly, Harry Tangalakis, a CB Richard Ellis first vice president, tells GlobeSt.com the Reis Report conclusions don't surprise him.
"If you're looking at the market overall, I wouldn't be surprised if the overall rates are higher," Tangalakis says. "If you look at the majority of the space in Broward and Miami-Dade counties, comparing office warehouse-type space, the average is probably closer to $5.75 per sf net."
Tangalakis has always seen the Broward County industrial-warehouse segment as a highly desired market.
"For instance, there is industrial property selling for $90 per sf in Broward County," Tangalakis says. "That's extremely high. "Many are selling in the range of $80 to $90. Most of the buyers are investor types, though some users are jumping into the arena."
In its report, Reis estimates that asking rents for industrial space in Broward County average about $6.37 per sf, with effective rents averaging about $6.21 per sf. Those averages are projected to grow at 2.6% and 2.5%, respectively, this year, compared to a gain of 3.5% last year.
The Broward averages compare with the estimated average asking rents of $5.59 per sf and effective rents of $5.47 per sf in Miami-Dade County, according to a Reis report published this summer. Those averages are expected to increase by 3.8% and $3.9%, respectively, over the next three years.
One of the companies making a particular impact on the Broward County industrial-warehouse market is Industrial Developments International Inc., the Atlanta-based subsidiary of Kajima Corp., according to the report.
"Planned projects include the Weston Business Center and the Pompano Business Center, both in Broward County, and a 60-acre parcel in Miramar, with plans to add about 900,000 square feet of speculative distribution/warehouse space in three buildings--two of which are expected to be the biggest spec warehouses ever built in South Florida," according to the report.
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