Another year and another massively successful CIASF Industrial Market Report. We’d like the thanks all those that helped us pull it off. Especially Sebastian Juncadella and Fairchild Partners for his part in the presentation.
For any who need a copy, you can download the full report on here.
We were also quoted in the Real Deal’s coverage of the event. Which you can read on their website. Pay no attention the fact that they called in the 2017 report.
For those that missed it or want to print out there own copy of the 2017 Industrial Market Report, you can get it here or on our Reports page.
Last week, Andrew and I presented the 2014 Miami-Dade County Industrial Market Study to over 170 members of the Commercial Industrial Association of South Florida and guests. This is the 18th year we have reported on the industrial market conditions in South Florida.
The Market Trends Section reported a growth in industrial space for the year of 2012 of just over 456,000 SF a decrease of 336,000 SF from the prior year. The industrial employment sector shows an increase of 6,800 to over 172,300 employed. For the year of 2013 projected total freight at the Port of Miami decreased by 1.6% while freight through Miami International Airport increased by 3.3%.
The Market Activity Section shows volume of warehouse sales over 10,000 SF at 137 properties, with an increase in the average sale price to $56/SF. While the dollar amount of sales increased by 54% to $397,870,850 with an average building size of 49,000 SF.
Summary:
Although the market continues to improve, there is concern that rental rates and sales prices are reaching a peak. This results from an increase in the supply of quality industrial buildings coming online in 2014 and sales prices of existing buildings not supported by rental rates.
The newer industrial buildings feature a minimum 30’of clear interior height, 54’ wide column spacing allowing for 4 loading doors, rear loading truck access with large parking aprons and easy truck access. Interior improvement include T-5 high efficiency lighting systems combined with motion activated switches, EFSR sprinkler systems, windows over the loading door for natural light and high quality interior finishes in the office areas with 9 to 12’ ceiling heights.
Strongest demand is for space between 10,000 SF and 30,000 SF. Landlords should reposition larger blocks of vacant second generation space, or older 24’ clear height product and subdividing these larger vacant spaces into smaller bays in order to target smaller tenants in the market seeking from 20,000 to 50,000 SF.
Some landlords are offering a Rent Abatement. Typically, tenants are able to receive one month of total free rent for every three years of lease terms and two months free rent for every five years of the lease term.
Unlike previous years when we noted that Miami had become a temporary storage and transportation hub, manufacturing is on the rise. Latin America companies are moving their operations to Miami-Dade for political and economic reasons. These include food processing and aviation companies. In addition, medical drug and equipment manufacturing is active, with some tenants purchasing their own facilities.
The market continues to improve, with lower vacancy rates, rental rates $.50 to $1.00/SF higher than last year and continued demand for industrial space from both a rental market and purchase market perspective.
Tenants seem doubtful that the new Panamax Ships/Larger Port will benefit them directly. However, we do see the possibility of larger amount of perishable goods that need cooler space coming through on the ships from South America.
If you’d like more information about the “Commercial Industrial Association of South Florida” send an e-mail to [email protected], or you can view and download the entire Market Report on our website.
2014 Industrial Report
By Tom Dixon
We just finished our presentation of the 2012 Industrial Market Report for the Commercial Industrial Association of South Florida. For those that missed it or need more copies of the report they can be found HERE, under our CIASF Tab, or on the CIASF website.
On Thursday June 17,th we presented the 2010 South Florida Office Market Report. If you missed the presentation or want a copy of the printed report you can find it and all the previous report under the CIASF tab of our website.
We just added a PDF version of the CIASF’s 2010 Hospitality Report compiled by Guy Trusty to our CIASF page. Check it out.
Last week Andrew and I presented the 2010 Miami-Dade County Industrial Market Study to over 240 members of the Commercial Industrial Association of South Florida. This is 15th year we have reported on the industrial market conditions in South Florida.
The Market Trends Section reported a growth in industrial space for the year of 2008 of just over 267,000 SF a decline of about 87% from the prior year. This downward trend was also evident in the industrial employment sector showing an employment decline of 7,600 to a total employment of just over 175,000. For the year of 2009 projected total freight at the Port of Miami declined by 8% while freight through Miami International Airport declined by 20%.
The Market Activity Section shows volume of warehouse sales remained the same at 74 buildings but a decline in the average sale price from $71/SF to $69/SF. The dollar amount of the sales decreased by 55% to $108,328,400. The industrial condominium market also slowed with a 25% decline in sales volume in 2009 and an average price decline from $144/SF to $122/SF.
Because of the variety of warehouse/industrial properties in various locations Miami-Dade County is divided into seven regions based on similar types of properties in each region. All regions are reporting an increase in the amount of rental space available, vacancy rates are as high as 18%-20% and rental rates have declined to as low as $3.50/SF in some areas.
Summary:
First year rental rates have declined from the mid $7.00/SF to as low as $3.50/SF. Some industrial property owners in larger buildings are renting for $1.00/SF plus all expenses (NNN) for the first year of a three year lease. Existing tenants are requesting rent rate reductions, abatement of rent or other concessions in exchange for longer term leases. Property managers are reviewing these requests on a case by case basis.
Vacancy rates should continue to increase from 13% and could rise to as high as 18% as a result of no new companies moving into this market. Existing companies are relocating from older less efficient buildings to newer buildings taking advantage of the lower rental rates in newer building with better access, parking and loading areas. This is forcing properties with functional problems to become even more rate competitive.
The major issues facing commercial property owners are the burden of additional governmental regulation and enforcement. Property owners are being forced to install expensive wired fire alarm systems, re-inspection for code compliance whenever a tenant applies for an occupational license.
The encouraging news in cargo compared to other US Customs districts is that Miami’s decline of 15% in trade from June 2008 to June 2009 was the smallest of all districts except Norfork/Mobile/Charleston. With the construction of two cargo facilities, the Miami International Airport will have an additional 800,000 SF of cargo space plus a new fumigation facility. At the Port of Miami the dredging of the channel to 50’ depth will make Miami only one of three ports on the Eastern Seaboard with this depth which can take advantage of the widening of the Panama Canal. These factors will improve Miami’s international trade as the economy recovers and secure Miami’s future as a major air and sea port.
If you’d like more information about the “Commercial Industrial Association of South Florida” send an e-mail to [email protected] or you can view and download the entire Market Report.
By Tom Dixon
Last week Andrew and I presented the 2009 Miami-Dade County Industrial Market Study to over 240 members of the Commercial Industrial Association of South Florida. This is 14th year we have reported on the industrial market conditions in South Florida.
The Market Trends Section reported a growth in industrial space for the year of 2007 of just over 2,000,000 SF a decline of about 10% from the prior year. This downward trend was also evident in the industrial employment sector showing an employment decline of 2,500 to a total employment of just over 182,600. For the year of 2008 projected total freight at the Port of Miami declined by 6% while freight through Miami International Airport remained the same.
The Market Activity Section shows a decrease in the volume of warehouse sales from 144 in 2007 to 74 in 2008 and a decline in the average sale price from $85/SF to $71/SF. The industrial condominium market also slowed with a volume of 349 in 2007 to 167 in 2008 and an average price decline from $149/SF to $144/SF.
Because of the variety of warehouse/industrial properties in various locations Miami-Dade County is divided into seven regions based on similar types of properties in each region. All regions are reporting an increase in the amount of rental space available, an increase in the vacancy rate of 2% to 5% and rental rate declines of $2.00 to $4.00/SF.
Summary
If you’d like more information about the “Commercial Industrial Association of South Florida” send an e-mail to [email protected] or you can view and download the entire Market Report on our website www.dixoncommercialre.com
By Tom Dixon
On June 13th, real estate brokers, Tony Puente, Robert Meneses and I presented the first Annual South Florida Office Market Report to over 120 members of the “CIASF” Commercial Industrial Association of South Florida. This report provides a snapshot of the Office Market Conditions for the year. For research purposes Miami-Dade County is divided into 7 regions and information for each region was provided. This information includes a description of the region, office rental rates, example of a typical lease, a typical office building sale and a typical condominium office sale. Included with each example was a complete description of the building and a photo.
Here from the report is the summary of Office Market Conditions for 2008:
· The office leasing and investment sales market is healthy, but there is a yellow (cautionary) flag waving in the wind. Demand/absorption of new space is expected to be flat or negative for 2008 with some tenant growth in legal, accounting and insurance companies, but a significant decline in demand from financial, mortgage and real estate companies.
· With no significant deliveries of office space in 2006 and 2007 up to 4 million SF of office space will be delivered over the next 12-30 month with three large buildings in the Downtown/Brickell corridor and eight in the Doral and surrounding areas. Adding to the rental supply are some condo office buildings reverting to “for lease” buildings creating a hybrid-building ownership situation.
· The leasing market will remain active with up to 20% of leases expiring in the next two years. Also, as rental rates rise to $50/RSF large tenants will seek less expense alternative locations. In addition, the “for sub-lease” market will continue growing and offer alternatives to tenants.
· Demand for office investments by institutions remains strong and will continue. However, price expectation by buyers has changed significantly with higher capitalization rates, difficult debt and finance markets resulting in lower prices.
After the information on transactions in each region was presented, I provided my analysis of the future “Supply and Demand for Office Space” for Miami-Dade. For the current demand analysis I multiplied the number of employees in the Department of Labor categories, information, finance and insurance, real estate, professional services and management by a factor of 325 SF per employee. This represents an indicator of the demand. For future demand I projected a 2,000 per year increase in employee in these categories. For the existing supply analysis I totaled the adjusted area of all office buildings in Miami-Dade over 5,000 SF. This information was from the Public Records available at the office of the Property Appraiser. For future supply I projected an annual increase in office space of 500,000 SF except for 2009 when 3,500,000 SF is expected to be put on the market. The difference between supply and demand is the vacancy rate. This rate is projected to increase above 12% in 2009 and if the assumptions are correct decline in future years to a more typical rate of 8% to 9%.
If you would like to view the entire presentation in a downloadable and printable format you can go to www.dixoncommercialre.com and click on the CIASF Office Market Report in blue at the bottom of the page or you can go directly to the report if you click on this link:
2008 South Florida Office Market Report Link
For information to join the Commercial Industrial Association of South Florida contact Nick Kallergis Executive Director at 305-443-6233.
CALL US. WE HAVE THE FACTS AND FIGURES TO HELP YOU MAKE REAL ESTATE DECISIONS.
by Tom Dixon