As Miami welcomes another delivery of over one million square feet of new industrial inventory, the vacancy rate rose again to 4.3 percent in the second quarter of 2017. Year-to-date the market has received more than 2.2 million square feet in new supply, and while the pipeline of tenants in the market seeking space is still high, absorption has not caught up with new delivery. Miami-Dade undeniably needed the new supply as vacancy rates reached a tenyear low of 3.6 percent at 2016 year-end, however, the market received a heavy supply of spec space within a six-month time-span.
Fundamentals in Broward County remain solid in the second quarter of 2017 as a relentless demand drives absorption and continues to outpace new supply. Rent growth at warehouse and distribution centers over the past year surpassed 5 percent, while rent growth at flex and office service space exceeded 11 percent over the past year. Tenant interest is highest for flex space with high parking ratios, particularly since parking ratios at most office buildings are not sufficient compared to ratios at most suburban flex spaces.
A growing consumer demand fortifies the expanding industrial market in Palm Beach County. Market indicators reflect a steady second quarter with vacancy rates firmly at a ten-year low and strong absorption of newly delivered space.
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