Market Statistics for Miami Industrial Real Estate - Q2 2016
We are halfway through 2016. Miami’s Industrial Real Estate Market continued it’s solid performance, albeit slower than other quarters. Vacancy rate for the second quarter declined to 4.4% from 4.5% in the first quarter and, 4.9% in the second quarter of 2015. The net absorption of warehouses space was 537,437 Sq. Ft. down from 586,062 Sq.Ft. in the first quarter and 959,898 in the second quarter of 2015. The chart below shows the changes.
The 4.4% vacancy rate is one of the lowest Miami’s industrial real estate market has seen in 10 years. The slowdown in net absorption could signal that demand for warehouse space is not keeping up with the new supply of warehouse space. As the table shows, absorption in the second quarter was 45% lower than the same time last year and 8.3% lower than the first quarter.
New construction showed a strong performance in the second quarter. 727,024 Sq.Ft. were delivered during this quarter. This is an increase from the 406,362 delivered in the first quarter and 189,140 SF delivered in the second quarter of 2015. The addition of new buildings increased the total inventory of industrial space in Miami to 234,653,908 Sq. Ft. on 8,884 buildings. At the end of the second quarter, there were 2,397,088 Sq.Ft. of industrial space under construction; very close to all-time highs.
On sales of buildings, the second quarter reported 33 building sales at a volume of $90,583,000, totaling 1,047,769 Sq.Ft. This is an increase from the first quarter where 22 building sold at a volume of $61,787,900 on 1,123,071 Sq.Ft. However, it’s down from the second quarter of 2015, where 35 buildings sold at a volume of $228,963,300 on 2,448,548 Sq.Ft. The market continues to experience a low inventory of properties for sale, which has kept pushing sale prices to peak highs.
The second half of 2016 is expected to experience a strong performance of sales and leasing. Last year, third quarter saw a net absorption of 706,060 Sq.Ft. and sales of 43 industrial building for a volume of $193,694,335.
This quarter, the first ship that crossed through the expanded Panama Canal arrived to Miami. There has been mixed debates about the effects of the Panama Canal expansion on the Miami’s industrial real estate market. Still, it’s expected to be a net gain for Port Miami and logistic businesses. One company that moved to Miami to benefit from the Panama Canal is Seafrigo. Our team helped the company lease refrigerated space at Sough Florida Logistics. See the story HERE.
Until next quarter, feel free contact us any questions on Miami’s Industrial Market. We are the Miami Industrial Team. 786-433-2380.