Direct Office Vacancies Rise Downtown

MIAMI-Direct vacancy rates have increased for the fifth quarter in a row in the Downtown office submarket of Miami-Dade County, according to a new report by CB Richard Ellis.Downtown has experienced just 79,095 sf of leasing activity in the first six months of the year. However, the average asking rates did grow from $22.53 to $23.85 per sf year to date, due to more premier space available, commanding higher rates.By contrast, the Brickell submarket saw the most leasing activity–356,793 sf–in the county in the first half of the year. Direct vacancy rates dropped here in the second quarter for the first time in 2.5 years. The submarket also saw sublease space decline from 34.5% to 9.4% of available space over the past year and a half.For that period, overall vacancy rates fell from 16.1% to 11.4% in the Coral Gables submarket. Class A rates fell from 22.8% to 12.4% for the period. Currently, average asking rates are beginning to rebound.In the airport submarket, recent plans to destroy some of the 30 office buildings at Doral Center to create residential space could dramatically reduce the office inventory and available space. The Coconut Grove submarket continues to see tenant commitment. However, it is seeing “marginally improving indicators,” and the submarket isn’t expected to completely recover quickly, according to the report.