From still left: Blackstone’s Stephen Schwarzman and Fairchild Partners’ Sebastian Juncadella alongside with the Miami International Commerce Center at 8181 Northwest 14th Avenue in Doral (Getty, Google Maps, LinkedIn/Sebastian Juncadella)
Speaking to a ballroom comprehensive of their fellow dealmakers, South Florida brokers experienced a basic information: Our market is greater than the relaxation.
Listed here are some highlights from the 2023 CRE Outlook Conference, hosted by the Miami chapter of the Licensed Business Investment decision Member Institute, or CCIM. Brokers talked up new progress action in the trophy place of work sector, the retail market’s minimal vacancy level in contrast to nationwide figures, and Blackstone’s expending spree.
Industrial
Blackstone dropped $1.3 billion for industrial attributes in Miami-Dade County last 12 months, an indicator that South Florida commercial sector’s robust performance will go on in 2023, according to a presentation by broker Sebastian Juncadella.
The investment large led all industrial buyers in sales quantity in 2022, Juncadella explained to a ballroom comprehensive of commercial brokers and builders at the DoubleTree by Hilton Lodge Miami Airport & Conference Centre on Wednesday.
“Overall, the industrial house is doing really perfectly,” Juncadella said. “[In Miami-Dade], builders have rushed to satisfy desire. We designed the most ever in 2022, and we’ll set a record throughout the U.S. for [new industrial construction] in 2023.”
Juncadella, with Miami-based Fairchild Companions, joined Rafael Romero with JLL and Kevin Gonzalez with Colliers in offering shows on Miami-Dade’s industrial, retail and office environment marketplaces.
New York-primarily based Blackstone is also the most significant spender in Airport West, amongst the most coveted industrial sub-markets in Miami-Dade, Juncadella reported. In June, Blackstone paid $7.6 billion for PS Enterprise Parks, a predominantly industrial Serious Estate Investment Rely on centered in Glendale, Calif. With its acquire, Blackstone acquired PS’ Miami International Commerce Centre, a 3.5 million-sq.-foot company park in Doral, Juncadella claimed.
“Blackstone inherited a single of the very best company parks in Miami,” he mentioned. “No 1 comes close to the quantity of revenue they spent in Airport West.”
San Francisco-primarily based Prologis ranked as the second most significant buyer of Miami-Dade industrial qualities very last yr, with $1.1 billion in acquisitions. The business led the cost in pushing asking rents to file highs in the county considering that the onset of the pandemic, Juncadella reported.
“Prologis started pushing rents up,” Juncadella explained. “They would ship us proposals that had been outlandish, way greater than anyone else. Slowly but surely, but definitely, they moved the needle, pushing over 20 % lease growth, calendar year-over-calendar year.”
Workplace
The migration of out-of-state corporations to the South Florida location has created a paradigm change in the regular sq. footage that business office tenants are seeking, Colliers’ Gonzalez explained to the CCIM crowd.
“In the past, Miami tenants on ordinary have been 500 square feet,” Gonzalez said. “If you glance at the latest changeover, and as we experienced, the average dimensions of these tenants [has] been 2,500 sq. feet.”
Among 2021 and last yr, 76 new-to-current market companies inked 2.5 million of new leased business office space in Miami-Dade, Broward and Palm Seashore counties, Gonzalez mentioned.
The South Florida place of work market’s “poster child or darling” has been the Brickell submarket, led by 830 Brickell, a 55-tale business office tower that is under development, Gonzalez additional.
Made by Vlad Doronin’s OKO Group and Jonathan Goldstein’s Cain International, 830 Brickell is 100 p.c preleased and has realized rents of much more than $100 a sq. foot, Gonzalez mentioned. “That’s good news for Brickell,” he said. “Downtown Miami is ultimately starting off to see some of the benefits of the rent spread.”
Co-operating sites have performed a big part in filling tenant need, Gonzalez famous. “I cannot think of 1 co-doing the job operator that is not 95 percent occupied,” he stated. “Going ahead, as we adopt a hybrid office environment model, those co-doing work operators will be crucial.”
Retail
South Florida has one of the strongest retail true estate sectors in the nation, JLL’s Romero stated throughout his presentation. Landlords in the tri-county region are commanding asking rents of $34.21 for every square foot, in comparison to $23.47 per square foot nationally, Romero stated.
The South Florida retail general emptiness charge was 3.4 p.c past 12 months, in comparison to 4.3 p.c for the overall U.S. retail marketplace, Romero included. “Last year, we opened more outlets than we closed,” he claimed. “That has not took place considering the fact that 1995.”
