Real Estate Report Card
The Pain Spreads in Real Estate
Hotels are benefiting from increased tourism, but economic conditions are hurting other sectors of the commercial market.
Industrial: A Mixed Bag
STRENGTH: Markets that distribute goods to Latin America are weathering the storm. [Photo:Daniel Portnoy]
While Florida’s industrial sector has been affected by the nation’s economic and housing slowdown, the impact differs from market to market.
In Orlando and Palm Beach County, for instance, vacancy rates have climbed to the 8% range largely because many industrial users supply the slumping construction and real estate trades. In contrast, vacancy rates are lower and leasing activity is stronger in Miami-Dade, Tampa and Jacksonville, where many industrial parks cater to export activity. “South Florida had $79 billion in trade last year, as exports have been helped by the weak dollar,” says William Holly, CEO of Holly Real Estate/TCN Worldwide in Coral Gables. “That supports demand in the region’s industrial market.”
However, Ben Eisenberg, managing director at Transwestern in Miami, notes that many small-space users are re-evaluating their space needs. In addition, major corporate users of industrial space are holding off on their space decisions for now.
“It is the entrepreneurial medium-size tenant, from 10,000 to 50,000 square feet, that is driving the south Florida market today,” says Eisenberg. “The companies that distribute goods to Latin America seem to be weathering the storm and doing very well.”
In Broward and Palm Beach counties, large blocks of industrial space — 100,000 square feet or more — are available for the first time in many years, says Andrew Rudzinski, CB Richard Ellis’ managing director for Broward County.