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South Florida Market Reports

South Florida Office Market Report

Average Asking Rent (Price/SF)    $31.26
Vacancy Rate (%)     12.2%
Net Absorption (SF) 386,522

The second quarter of 2017 marked the twenty-second consecutive quarter of demand growth for South Florida's office market. Net Positive net absorption improved from the prior quarter and from one year ago with 386,522 square feet, as the vacancy rate dipped 90 basis points from one year ago to 12.2%. Market growth for secondary space dominated in the second quarter, as the Class B sector turned in 220,535 square feet of absorbed space. After a slight correction last quarter, Class A space once again saw demand outpace supply, as higher-end space experienced 140,651 square feet of positive net absorption during the second quarter. The Class C segment remained lackluster with 26,336 square feet of absorbed space for the quarter. Landlords still held the upper hand in negotiations, as the overall average asking rent increased $0.49/6F to $31.26/SF during the second quarter. Broward County held onto the lowest vacancy rate after rebounding from a slight correction in the first quarter, while Miami was only 50 basis points behind due to stronger performances. Palm Beach continued to slowly eliminate portions of the excess space lingering from the recession, with vacancy dropping below 15.0% for the first time in a decade.

South Florida Industrial Market Report

Average Asking Rent (Price/SF)              $8.44
Vacancy Rate (%)               4.4%
Net Absorption (SF)         412,626

The second quarter of 2017 saw a slowdown in industrial demand from the previous quarter, as positive net absorption totaled more than 400,000 square feet, bringing midyear net absorption to 1.7 million square feet. This represents a decrease of roughly 56.5% from one year ago yet is still consistent with prior midyear performances. The increase in new industrial supply over the past 12 months kept vacancy level with the 4.4% recorded one year ago. Robust development of more than 4.2 million square feet of new industrial inventory delivered over the past 12 months kept vacancy from decreasing year-over-year for the first time since the recovery began seven years ago. The region's tight market conditions and increase in high-end distribution space translated into a rise in the average asking rate for the 22nd consecutive quarter, with a gain of $0.49/SF from this time last year to $8.44/SF, just shy of the $8.55/SF record set in 2008. R&D/flex space saw the largest year-over-year year rise, to $12.20/SF from $10.90/SF, while general industrial space followed, increasing to $8.58/SF from $7.95/SF during the same time period. The robust leasing activity in new developments throughout South Florida hindered significant jumps in rent averages for the warehouse/distribution segment, which rose to $7.32/SF from $7.01/SF from one year ago, as lower-tier vacancies have more of an impact and are less representative.



South Florida Office Market Report
2Q17
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South Florida Industrial Market Report
2Q17
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South Florida Capital Markets Report
3Q16
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