Q4 | 2021
Miami Industrial Market Report
INDUSTRIAL MARKET SUMMARY
The Miami industrial market’s Q4 vacancy rate was 2.8% and the availability rate is 5.1% at the close of the quarter with a $15.11/SF average (gross) lease rate. Year-over-year rent growth is 14.5% in the industrial market, far above the national average. Miami ranks as one of the priciest industrial markets on the East Coast due to the lack of available, buildable land.
There is roughly 4.9 million SF of new construction in the works, with 4.4 million SF delivered over the past 12 months. New properties lease quickly in Miami. Since the start of 2020, new industrial properties built in that time are about 90% leased. Developers focus on small to medium-sized industrial facilities due to the lack of buildable land in South Florida. The average industrial property built since 2010 is about 100,000 SF.
Vacancy rates in Miami are below 3% and are back at record lows. Annual rent has been rebounding after two years of slowing significantly. The average rent in Miami is one of the highest in the country at an average of $15.00/SF compared to the national average of $9.70/SF.
Annual industrial sales volume is up with an average quarterly sales volume in Miami of about $400 million since the start of 2021. This is above the metro’s quarterly average in the years leading up to the pandemic. Prologis (14 million SF) and Blackstone (9 million SF) have the largest industrial portfolios in Miami, owning roughly 10% of the metro’s inventory combined.
Overall unemployment is still about three percent below the region’s pre-pandemic peak as of November 2021. Leisure and hospitality employment was still about 20% below the February 2020 peak as of November 2021, and the pace of job growth in this sector continues to be slow. However, employment in professional, business, and financial activities sectors is well above pre-pandemic levels. Companies such as Microsoft, Blackstone, and Millennium Management have recently leased sizable office space in Miami and are expected to add hundreds of high-paying jobs when fully staffed.
Contact ComReal’s Industrial Team for more market insights.