MIAMI-From Miami through Ft. Lauderdale and into West Palm Beach, South Florida industrial occupancy rates are rising. Vacancy rates in the tri-county area’s industrial markets declined in 2010.
So say year-end statistics from Cushman & Wakefield. “Vacancy rates for all three submarkets continue to decline and remain well below the U.S. industrial average vacancy rate of 10.3%,” says Shane Soefker, senior managing director and branch manager for Cushman & Wakefield’s South Florida offices.
Miami-Dade County’s industrial vacancy rate declined to 7.9% at year-end 2010, down from 8.3 percent at the end of the previous quarter. That makes Miami-Dade among the top 5 U.S. industrial markets with the country’s lowest vacancy rates.
Asking rates increased slightly, reaching $5.37 per square foot at year-end. If there was a grey cloud, it was leasing activity, which was down 5.7% from the 5.3 million square feet leased in the previous year.
Still, absorption improved dramatically in 2010—the first time yearly absorption was positive since 2006. Overall absorption for Miami-Dade totaled positive 2.7 million square feet, compared to negative 3.9 million square feet in 2009. Soefker says, “Limited new construction and consistent leasing activity levels should keep the Miami-Dade industrial market in the positive absorption territory through 2011.”
The overall vacancy rate for Broward County’s industrial market fell to 8.9% at the end of 2010, down from 9.1% at the end of the third quarter, and the lowest vacancy rate since year-end 2008. “Fundamentals in the Broward County industrial market have improved considerably,” Soefker says. “Continued improvements in leasing activity signal increased demand and growing optimism on behalf of both owners and occupiers."
Palm Beach experienced the largest decrease in vacancy of South Florida’s three industrial submarkets. Overall vacancy declined to 9% at year-end, down from 9.9% at the end of the third quarter. Says Soefker, “With virtually no new construction and consistent leasing activity, Palm Beach registered one of the largest quarterly vacancy declines in the U.S.”
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