For example, vacancy rates have started to drop in the Downtown submarket of Broward County, and the area has seen a rise in average asking rents recently, the report states. The round-the-clock neighborhood this area is becoming is expected to result in a greater demand for office space, as well as less quality office development property. The report summarizes the mood here as "patient and optimistic."
Vacancy rates have decreased slightly in recent months in the Commercial Boulevard submarket of Broward, which overall is relatively flat with not much new leasing activity. More new tenants or expansions will be needed to increase the stable average asking rents. The Northwest Broward submarket is experiencing low vacancies and rising average asking rates, although the rates are still low compared with the rest of the county.
In the Boca Raton submarket of nearby Palm Beach County, direct vacancy rates are continuing to drop, as is sublease space, which should mean higher average asking rates in the near future.
The West Palm submarket is expected to see falling vacancy rates and rising rents in the near future, although some areas of this submarket are performing better than others. In the Palm Beach area, demand is stronger than supply, which has helped limit vacant space and contributed to the highest average asking rates in Palm Beach County. The area, although smaller, is seeing "good tenant activity."
While conditions seem to be improving in these South Florida submarkets, others are experiencing rising vacancy rates. Among them: the North Palm Beach submarket, where higher vacancy rates have led to increased tenant incentives, including reduced rental rates.
Vacancy rates also were up recently in the Southwest Broward submarket, as many tenants found space in other submarkets. The supply and demand in the area is balanced here, and the area has one of the fastest-growing average asking rates in this county.
In Broward's Plantation submarket, new class A projects may result in higher vacancy rates, although tenants still are attracted to this area, as it offers low average asking rates. Property owners are aggressive in the Cypress Creek area--the second-biggest submarket in Broward-—the CBRE report states. Conditions here may get worse before getting better.
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