Market Statistics for Miami Industrial Real Estate - Q4 2015
Miami’s Industrial Real Estate Market experienced robust growth in Q4 2015. The vacancy continued its decline to 4.7%, down from 4.9% in Q3 2015. Attributing to this decline was the net positive absorption of 901,957 Sq. Ft.
The lease rates for industrial space increased to one of the highest rates in over five years. The average asking lease rate in Q4 2015 stood at $9.01 per square foot (Industrial Gross) representing a 3.0% increase from the third quarter where the average lease rate stood at $8.75/ Sq. Ft.
The delivery of new industrial buildings continued its strong trend this last quarter with another. 459,805 Sq. Ft. of new warehouse space delivered in the fourth quarter of 2015. In total, 2,030,076 Sq. Ft. of new industrial space were added to the market last year. The total inventory of industrial space is Miami is now at 232,940,317 Sq. Ft. on 8,855 buildings.
Sale activity reported $109,850,000 on 29 buildings totaling 1,254,154 Sq. ft. and averaging about $87.59 per sq ft. Overall, 2015’s sales volume totaled $544,307,635 and pushed cap rates lower from 7.97% average in 2014 to 5.51% in 2015.
The strong absorption and low inventory of available properties have put pressure on prices in favor of landlords/sellers. The number of concessions and incentives offered by landlords have decreased considerably, especially for spaces under 20,000 Sq. Ft.
Transitioning to a global scale, we ask ourselves, how will the downturn in China and Emerging Markets, including Latin America, affect the market? Miami, being the gateway to Latin America, is likely to see less activity from companies that do business in those countries. This slowdown could affect smaller companies more so making it difficult to pay rent or mortgage. As a result, we are seeing a more than usual increase in the subleases available under 10,000 Sq. Ft.
Despite uncertainty in the U.S. and world economies 2016 will still be a great year with strong absorption and an increase in prices for industrial space in Miami.
For more information and other market statistics, contact the Miami Industrial Team at 786-433-2380.