“We expect the momentum in the South Florida industrial market to continue in 2019 due to changing consumer dynamics as a result of e-commerce and continued population growth,” Wasserman said. “All of these factors are causing increased occupancy rates, rapidly rising rents, and record-high net absorption in 2018, making industrial the best asset class for investors.”

Industrial owners at the forum said they do not foresee an oversupply of inventory in the next two years and believe cap rates will settle at 4.5% or less this year. In fact, owners contend that an additional 50 million square feet of industrial space is needed over the next five years based on forecasted population growth and historical absorption per capita in South Florida, Colliers reported.

“The majority of owners and representatives believe the issue of land scarcity in South Florida will continue to drive higher rents,” Colliers states in its recap report on the forum. “Despite an inevitable downturn, South Florida is still a good market for investments with much capital available and a large amount of new deliveries coming online that is expected to be quickly absorbed.”

Other headwinds for the industrial market include: prolonged permitting processes, rising construction costs, shortage of laborers and a looming idea of the possibility of a market correction over the next 24 months.

“To prepare for a down market, owners are approaching tenants to renew their leases early,” Wasserman says.

While industrial real estate owners were bullish on the market going forward, Wasserman says, “Although South Florida is a hot bed for industrial investment activity, we should expect a lower return environment over the next few years.”