Friday, April 15th, 2011
TAMPA - For the first quarter of 2011, the Florida commercial real estate market experienced slow-moving, but positive, trends following the momentum of last quarter.
Markets in South Florida moved at an accelerated speed compared to North Florida, as reported by the State of Florida MarketViews on office and industrial properties, released by CB Richard Ellis (CBRE). Real estate professionals project continued progress, with the possibility of short-term pauses.
“The first quarter sustained the positive trends of last,” said Mary Jo Eaton, CBRE’s senior managing director for Florida. “We hope the increase in activity in South Florida is a leading indicator for the rest of Florida’s markets.”
Key findings include:
- For office properties, notable absorption of sublease space continues across the state, and we project rental rates to stabilize, having increased slightly in the first quarter after nearly two years of declines.
- Net absorption for the quarter was 254,488sf, with the largest gains in the Tampa Bay market (287,932sf).
- Orlando delivered 105,000sf during the first quarter. South Florida markets are slated to deliver the bulk of new space to market.
- For both product types, spreads in average cap rates can be explained by the types of properties trading; high-quality assets with strong tenant bases or the complete opposite, distressed assets.
- For industrial, Miami shows strong signs of improvement with 7.8% vacancy compared to 10.3% for the state. South Florida markets also saw the most industrial sales with 14 properties trading for a total volume of nearly $140 million (75% of the total industrial sales in Florida).
The CBRE State of Florida MarketView reports quarterly on seven major markets in Florida, covering office and industrial properties.
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