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New Office Supply Looms Large

MIAMI-Nearly two million square feet of new space is coming online as space demand erodes.

By Carl Cronan | Updated on July 27, 2009

MIAMI-Office construction activity in this market would normally be considered a good thing, but not with unemployment nearing 10% and job reductions eroding demand for space. Consequently, Miami-Dade County is facing tough times with nearly two million square feet of new space slated for completion this year, further softening property fundamentals.

Marcus & Millichap estimates that 1.8 million square feet of new offices are slated for completion this year, plus 740,000 square feet in 2010. Completions over the past year have increased local office stock nearly 2%.

“If the projects currently under way are completed as scheduled, for-lease stock in the county will increase by the greatest amount in any single year since the late 1980s,” says Kirk Felici, regional manager for Marcus & Millichap in Miami. At the same time, he points out, job losses are expected to continue, including an estimated loss of 16,400 positions among office users this year.

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