INDUSTRIAL MARKET SUMMARY
The Miami industrial market’s Q2 vacancy rate was 3.9% at the close of the quarter with a $13.78 per sq. ft.
average (gross) lease rate. Industrial vacancies have compressed after reaching higher levels in 2020. The annual
rent growth is 9.2%. After trending in line with the country for most of 2020, growth in Miami is now three
percentage points stronger in recent quarters.
There are over 4.4 million sq. ft. of new construction in the works, and about 4 million sq. ft. was delivered over
the past year. This is including the one million SF Home Depot distribution center in Hialeah, which completed
construction in early 2021. Most of what is being built is speculative. The largest speculative projects are in
the 200,000 SF-300,00 SF range like the two buildings at Gratigny Logistics Center in the North Miami Beach
Submarket, which totals 447,000 SF and is due to complete in coming quarters.
Vacancy rates in Miami are around 3.9% and are back below the National Index rate. Though international
trade has been impacted by the government pandemic, the e-commerce sector, including Amazon, has been
responsible for many of South Florida’s largest lease deals in the past seven months. In April, Amazon leased
about 220,000 SF at the newly built Prologis Beacon Lakes Industrial Distribution Center in the Miami Airport
West Submarket. The company also leased a 210,000 SF property in the Hialeah Submarket, which it will
occupy following extensive renovations. Vacancies could stabilize once the 4.5 million SF under construction
delivers and leases. Construction starts have slowed, which along with a rebound in leasing in recent months
could keep vacancies stable.
Annual rent has been rebounding after two years of slowing significantly stronger here, and annual gains are
now about three percentage points stronger than the National Index. The average rent in Miami has grown
68% since 2011, while the National Index grew 56%. Still, at over $13.50/SF, the average rent in Miami is one
of the highest in the country and is more than 50% higher than the national average. Within the market, average
rents reach $21.50/SF in the South Central Miami Submarket, which is more than 130% higher than the national
average. Despite high rents, the submarket has maintained growth near 8% in the past year.
Annual industrial sales volume has bounced back and is now about 25% higher than the metro’s 10-year
average. Deals over $20 million have become less frequent during the past year, with only nine deals in
that range versus 17 deals in 2019. However, there have been a handful of smaller portfolios like the sale
of buildings six and seven at County Line Corporate Park in Hialeah. In June, Chicago-based CenterPoint
Properties acquired the two buildings totaling 412,000 SF from Miami-based Flagler Real Estate Services for $61
million. The 12-month sales volume growth is down 20.2%. Market prices are around $175/SF.
Though the region has regained some of its jobs toward the end of the year, as of the Bureau of Labor
Statistics’ (BLS) release of April jobs figures, the metro was still down about 100,000 jobs since February 2020.
Tourism has been greatly interrupted and the cruise industry with which Miami is intertwined will likely feel the
lingering effects for some time. While the shape of the economic recovery from the past year is yet to be seen,
in Miami it is likely to be prolonged. The high cost of living is likely to continue driving net negative domestic
migration from the city. The good news is that no one industry accounts for more than 15% of Miami’s jobs,
helping to insulate the city from higher losses as a proportion of the workforce during downturns.
Record Building Sale in Miami’s Sunshine State Industrial Park
The Industrial Team at ComReal completed a record sale for a building inside Sunshine State Industrial Park.
Highest Price per SF. The building is located at 1100 NW 163rd Dr. Miami, FL 33169. This building consists of +/- 23,331
SF freestanding on +/- 1.10 Acre. The building was formerly used as a specialized data center, offering heavy power,
fully A/C space, 3 backup generators, and a fully secured facility. The Seller was AINA Holdings, LLC which owned
the property for almost 20 years. The Buyer is 1100 BM Investments, LLC. The sale price was $3,200,000, $137/SF,
the highest price per SF sale in the park.
“This sale is a perfect example of the strong demand for industrial buildings in Miami. Hard to find buildings selling for
a record price. The building was offered for sale and lease and we had strong activity. Multiple offers to purchase offering the
owner strong options.” Mentioned Edison Vasquez, CCIM from ComReal.
This sale adds to the long list of transactions the Industrial Team has completed inside Sunshine State Industrial
Park. Last Summer, the team completed the sale of 1585 NW 163rd ST, a +/- 31,000SF on 2.4 Acres for $2,800,000.
Two leases at 1120 NW 165th St. And sale of 16215 NW 15th AVE Miami, FL 33169, +/- 63,683SF on 3.15 Acre for
$6,000,000.
For more information contact the Industrial Team at 786-433-2380 or evasquez@comreal.com.