A rebound has occurred in the Miami-Dade office market in the first half of 2017 after a comparably sluggish 2016. Vacancy rates have consistently dropped quarter-over-quarter to a low of 9.4 percent in the second quarter. Compared to the second quarter of 2016, the vacancy rate is 130 basis points lower. Meanwhile, net absorption has already exceeded the total for 2016 indicating a spike in demand this year.
Office leasing activity in Broward County in 2017 hit its lowest levels since the “Great Recession.” However, Broward County boasts its lowest vacancy rates and landlords continue to increase rents and capture record rental rates. Limited new construction is driving these fundamentals and helping to maintain a tight office market. As such, landlords still maintain leverage in lease negotiations and concessions remain consistent with prior months providing less than one month of rent abatement per lease year, but generous tenant improvement packages for credit tenants. Landlords also favor creditworthy tenants seeking long term space greater than 10,000 square feet.
Market indicators point to slow but steady improvements in the Palm Beach County office market. Overall, vacancy rates dipped 20 basis points to 12.0 percent and leasing activity picked up over the first quarter. Vacancy rates have reached a ten-year low and strong net absorption resumed.
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