2016: An Exceptional Year For South Florida CRE

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2016 was a robust year for South Florida commercial real estate.

Vacancy in all three sectors – Industrial, Office and Retail – has hit the lowest level in ten years. And reaping the benefits are the owners with the highest rental rates they’ve ever experienced.\

Best of Show is awarded to the Industrial Market with extremely low vacancy rates and sales prices that have increased more than 20% from 2015 levels.

The Office Market had one of the best net absorption years in recent history and it appears as though 2017 will be another good year.

Retail continues to remain stable however the specter of e-commerce seems to be affecting the long-term outlook.

 

 By The Numbers

 

South Florida Industrial Market
2016 Year End Numbers

 

Industrial Vacancy: Decreases to 3.8%

Total Inventory: 424,418,264 square feet

Vacancy: 3.8% down from 2015 vacancy of 4.7%

Net Positive Absorption: 7,139,224 square feet

New Construction Built 2016: 3,230,765 square feet

Under construction: 4,860,104 square feet

2016 4th Quarter Rental Rates: $9.44 per square foot up from 3rd quarter of $9.05 per square foot

2016 Dollar Sales Volume:  $949,797,900 up from 2015 volume of $850,729,387

2016 Average price: $109.89 / square foot up from 2015 of $90.70/square foot.

Cap Rate: 6.63% down from 2015 of 6.95%

 

South Florida Office Market
2016 Year End Numbers

 

Office Vacancy: Decreases to 10%

Total Inventory: 224,608,406 square feet

Vacancy: 10% down from 2015 vacancy of 11.1%

Net Positive Absorption: 2,971,508 square feet

New Construction Built 2016: 1,058,646 square feet

Under construction: 2,760,943 square feet

2016 4th Quarter Rental Rates: $29.68 per square foot up from 3rd quarter of $29.21 per square foot

2016 Dollar Sales Volume:  $2,207,855,357 up from 2015 volume of $1,952,168,415

2016 Average price: $228.21/ square foot down from 2015 of $238.93/square foot

Cap Rate: 6.53% up from 2015 of 6.41%

 

South Florida Retail Market
2016 Year End Numbers

 

Retail Vacancy: Decreases to 4.0%

Total Inventory: 278,113,656 square feet

Vacancy: 4% down from 2015 vacancy of 4.5%

Net Positive Absorption: 3,615,189 square feet

New Construction Built 2016: 2,084,532 square feet

Under construction: 3,943,579 square feet

2016 4th Quarter Rental Rates: $25.07 per square foot up from 1st quarter of $24.02 per square foot

2016 Dollar Sales Volume:  $1,492,870,118 down from 2015 volume of $2,601,110

2016 Average price: $246.99/ square foot down from 2015 of $310.58/square foot.

Cap Rate: 6.49% up from 2015 of 6.26%

 

 

The CoStar 2016 South Florida Year End Reports for the Industrial, Office and Retail markets can be downloaded for free from my website by CLICKING HERE

 

 

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