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Central Florida Market Reports

Central Florida Office Market Report

Average Asking Rent (Price/SF)      $22.59
Vacancy Rate (%)          8.5%
Net Absorption (SF)    373,553

Central Florida's office market remained healthy in 2017 despite a 23.6% drop in absorption from last year, when almost 2.1 million square feet was absorbed. The region recorded 1.6 million square feet of positive net absorption during 2017, marking the third-strongest year after 2015 and 2016. Overall vacancy dropped 120 basis points to settle at 8.5%, the lowest ever recorded for the region. The Class B segment took the lead with over 873,000 square feet of net absorption, while the Class A market fell to second place with 591,000 square feet. Lower-tier Class C space remained in third place with 193,000 square feet of growth, consistent with previous annual performances. Landlords held off on significantly increasing asking rents as the quoted average increased to $22.59/SF from $21.72/SF one year ago. Class A space increased $1.26/SF to $26.52/SF, the largest year-over-year increase since the recovery began. Class B space experienced a noticeably smaller increase of $0.51/SF to $21.43/SF during the same time period. Despite limited availability in high-end space, rent increases have yet to discourage tenants from leasing, and lower-tier rates continue to weigh down the overall average. This may change, however, as Class B dominated in demand and leasing activity, while only a limited number of blocks of Class A space remained.

Central Florida Industrial Market Report

Average Asking Rent (Price/SF)             $5.52
Vacancy Rate (%)              5.1%
Net Absorption (SF)        907,004

The Central Florida industrial market posted another quarter of solid performance, as nearly 907,000 square feet was absorbed in the third quarter of 2017, and vacancy shrank by 30 basis points from one year ago to 5.1%. Since the beginning of 2016, robust demand has accounted for more than 13.4 million square feet of positive absorption, increasing occupancy to nearly 95.0% for the first time in over a decade. This demand has come both new tenants entering the market and established tenants expanding in the market. The occupation of new industrial inventory delivered to the market lessened the impact such strong development otherwise would have had on vacancy. The decrease in vacancy translated into an average rent of $5.52/SF, an increase of $1.19/SF from when rents were at their lowest five years ago.



Central Florida Office Market Report
4Q17
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Central Florida Industrial Market Report
3Q17
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