South Florida Office Markets Chart Positive Absorption in 3Q
13 Oct, 2010, Miami
Cushman & Wakefield today released its third quarter statistics for the South Florida office market, showing the South Florida office markets of Miami-Dade, Broward and Palm Beach counties all recorded positive absorption in the third quarter.
"Tenants have expressed growing confidence in the South Florida office market, as evidenced by the increase in leasing activity," said Shane Soefker, senior managing director and branch manager of Cushman & Wakefield's South Florida offices. "Though much of this activity over the past nine months has been from current tenants relocating to new space to take advantage of competitive rental rates, South Florida's location, workforce and infrastructure continue to make it a desirable market for international companies."
The overall vacancy rate for Miami-Dade County fell to 18.1 percent at the end of the third quarter of 2010, down from 18.4 percent at the end of the previous quarter. Average rental rates decreased 3.8 percent - or $1.16 per square foot - from $30.93 at midyear 2010, ending the third quarter at $29.77 per square foot. Year-to-date leasing activity totaled nearly 1.7 million square feet, up 13.9 percent from the 1.5 million square feet leased at this time last year. Year-to-date overall absorption - a measure which indicates the net change in occupied space - was positive 334,436 square feet, a 66 percent increase in absorption from negative 1.0 million square feet at this time last year.
Broward County's vacancy rate decreased from 18.7 percent at midyear 2010, ending the third quarter at 17.7 percent, the lowest of South Florida's three submarkets. Rental rates remained stable, declining by 0.8 percent from $26.41 per square foot at midyear 2010, to $26.20 per square foot at the quarter's end. Year-to-date leasing activity declined year-over-year, totaling 1.3 million square feet at the end of the third quarter, down 18.3 percent from 1.6 million square feet leased at this time last year. Broward absorbed 212,746 square feet during the third quarter, the year's first quarter of positive absorption. Year-to-date absorption totaled positive 151,373 square feet, an 81.3 percent increase in absorption from negative 809,540 square feet at this time last year.
Overall vacancy increased in Palm Beach County during the third quarter of 2010, reaching 24.9 percent, up from 23.5 percent at midyear 2010, though still down from 25.3 percent vacancy recorded at this time last year. Rental rates fell 1.7 percent - or $0.47 per square foot - from $27.76 per square foot at midyear to $27.29 per square foot at the end of the third quarter. Year-to-date leasing activity totaled nearly 1.1 million square feet, on par with the 1.1 million square feet leased at this time last year. Year-to-date absorption totaled positive 477,422 square feet, a 32.4 percent increase in absorption from negative 762,709 square feet at this time last year.