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Industrious: Miami-Dade's industrial real estate sector is among the nation's most in-demand

The county’s industrial real estate market is among the nation’s hottest.

Miami-Dade has more than 157.2 million square feet of industrial real estate — warehouses, distribution space, manufacturing and what’s known as “flex” or “office service” space, which is mostly buildings that include showrooms or warehouses with some offices.

During the second quarter alone, 947,000 square feet of new industrial space became available in five new buildings, and another 2.4 million square feet is under construction.

Cushman & Wakefield says the county’s industrial market benefited from expansion of employment in transportation, warehousing and utilities, as well as the rapidly diminishing supply of developable land.

Investors like what they see: During the second quarter, some 3 million square feet of industrial property changed hands.

How Miami Compares: Industrial Real Estate Growth, 2010-16
Market Net Absorption Rent Growth
Miami-Dade 20.4 million sf 35.2%
Metro Seattle 20.8 million sf 2.3%
Northern New Jersey 11.5 million sf 16.6%
Metro Oakland 13.4 million sf 0.6%
Source: JLL Research

How Miami Compares: At the End of 2016
Market Asking Average Rent Vacancy Rate Under Construction
Miami-Dade $6.83/sf 3.9% 4.1 million sf
Metro Seattle $6.40/sf 4.5% 1.8 million sf
Northern New Jersey $9.00/sf 2.5% 2.8 million sf
Metro Oakland $6.77/sf 1.6% 3.0 million sf
Source: JLL Research

Industrial Snapshot (2Q 2017)

  • 5% Vacancy
  • 5.8% Historical average vacancy
  • 52,590 sf Net absorption (total square feet entering the market minus total square feet being leased
  • $8.13/sf Average asking rent
  • 12.5% Increase in average asking rent from a year earlier
  • 2.1 million sf Total warehouse/distribution leases signed, the most that’s been leased in any quarter since 2011
  • 850,000 sf Largest lease deal, signed by Amazon

Source: Cushman & Wakefield Marketbeat Miami- Dade, Industrial Second Quarter 2017

The Trend

Since 2010, demand for industrial space has outpaced supply in Miami- Dade more quickly than in comparable markets; rent growth has, too. According to real estate brokerage and research firm JLL, Miami-Dade’s strong GDP growth, population growth and the growth of e-commerce worldwide are the main drivers of demand. JLL measures industrial real estate differently from Cushman & Wakefield, noting 183 million square feet of industrial space in the county.

Innovation

Cruise Ease

Carnival Cruises has outfitted its Regal Princess ship with 72 miles of cable, 7,000 sensors and more than 4,000 interactive portals as it gets ready to roll out a digital concierge system. The wearable technology, about the size of a quarter, will allow passengers to access their rooms, make on-board payments and show them their schedules at any digital display onboard.

The cruise line recruited John Padgett in 2014 from Disney to head up the company’s Experience Innovation Center in Doral. Padgett developed Disney’s Magical Express, Magic Band guest pass and no-ticket Fast Pass+. All three allowed the park to gather volumes of data on visitors.

— Doreen Hemlock

Business Briefs

AVENTURA — Peerto- peer boat rental marketplace Boatsetter acquired Seattle-based competitor Boatbound. Boatsetter also announced it raised another $4.75 million from investors to fund international expansion.

DORAL — Stamford, Conn.-based United Rentals will acquire publicly traded equipment rental company Neff Corp. for approximately $1.3 billion in cash.

MIAMI — Atlanta-based Veritiv acquired packaging distributor All American Containers. A group led by Naples businessman Bruce Sherman purchased the Miami Marlins Major League Baseball team from Jeffrey Loria for $1.2 billion. Former Yankees star Derek Jeter is a partner in the group. After nearly 25 years of litigation, the bankruptcy of Southeast Banking Corp. finally closed.

MIAMI BEACH — London- based Generator Hostels will build its first U.S. property in South Beach, converting the former Atlantic Princess Condominium into a hostel. High-tech portfolio management startup Dvdendo, which helps individuals via a “robo-adviser,” raised $1.5 million, which it will use for marketing and technology development. Wynwood Yard will expand its model to the city’s North Beach area with North Beach Yard, an outdoor gathering space that will include an average of 35 food, retail and fitness businesses (mostly popup style) and will offer urban farming classes, live local music, events, cooking workshops and fitness classes.

MIAMI-DADE — The Federal Aviation Administration awarded more than $36 million in grants to Miami International Airport. The money will be used to reconstruct, improve and add capacity to three of its taxiways. Cargo airline Taca Peru began operating from Miami International Airport. Two men who worked for a major U.S. importer of gold from South America, Miami-based NTR Metals, pleaded guilty to a money laundering conspiracy that involved importing $3.6 billion of gold from South America. The majority of the gold imported into the U.S. comes through Miami International Airport. The U.S. Treasury Department extended and expanded its requirements that title insurers pierce the veil of shell companies that purchase real estate in the county. The new order, which expires on March 20, 2018, expands the requirement from cash transactions to those conducted via wire transfer.

NORTH MIAMI BEACH — The city’s Community Redevelopment Agency approved the second project in its CRA Redevelopment Area: Macken Cos.’ 5 Park will include two 19-story apartment buildings, a 71,637-sq.- ft. office complex, 30,210 square feet of retail and a six-story parking garage. Although the redevelopment area was created in 2005, the city didn’t begin approving projects for it until this past June.

Players

  • Fernando Perez-Hickman, who had been managing director of Sabadell America and chairman of the board of Sabadell United Bank, became director of corporate strategy at IberiaBank after it acquired Sabadell.
  • Jeffrey Duerk, former dean of the school of engineering at Case Western Reserve University, joined the University of Miami as provost and vice president. He replaced Thomas J. LeBlanc, who left to become president of George Washington University. In addition, Steven Altschuler, UM’s vice president for health affairs and CEO of its health care system (UHealth), resigned. Edward Abraham, dean of UM’s Miller School of Medicine, is serving in those positions on an acting basis.

 

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