2017 ends with only about 1.2M sq. ft. of positive absorption. A stronger market is closer to 2M sq. ft. (or more) annually. This being said, the overall vacancy rate slightly decreased to 4.0% and the average lease rate is at an all-time high at $9.76 per sq. ft. gross. Investors continue to purchase warehouse buildings at record-setting prices per sq. ft. The fundamentals of owning tangible real estate as an investment can be more appealing than the stock market, which can be more volatile and riskier. Large developers have over 5M sq. ft. now under construction of larger, bulk, class A warehouse spaces. However, there is a healthy demand for small-bay spaces, as well as class C warehouse space. It is nearly impossible to find any “economically-priced” warehouse space under $6.00 per sq. ft.
The question that some of us are now asking in the industry is, “Will 2018 be the year that we break the $10.00 per sq. ft. barrier for the average lease rate?” We are close enough that this may happen, although it will be grudgingly so. With so much new space being delivered on-the-market, landlords will likely not be able to drastically increase their lease rates due to fierce competition and knowledgeable tenant-rep brokers. A real problem that few professionals discuss is the lack of customer service delivered by landlords / owners. Unsatisfactory property maintenance and management, as well as very challenging lease terms imposed by landlords, are becoming the norm in today’s “owner’s market”. Welcome to Miami. Tenants are customers too and win-win lease transactions between both parties will be more respected when the market starts turning the other way, and it will one day.
At the U.S. national level, the average vacancy rate has also decreased slightly to 4.9% and the average lease rate increased to $6.46 per sq. ft. Our colleagues from around the country report that each of their respective markets were very dynamic in 2017. We look forward to entering the second year, of a new era, of lower taxation and less federal regulations. Now we just need to make Miami-Dade County great again.
The ComReal Industrial Team commences this year with the largest, available warehouse measuring 234,739 sq. ft. now listed for sale on-the-market (see below). In addition, we have a total of seven (7) buildings listed for sale in Miami over 25,000 sq. ft., which is more than any other brokerage firm in Miami. Please feel free to contact us anytime to discuss your commercial real estate needs in 2018 and beyond.
Missed Our Last Industrial Market Report? If you would like to read last quarter’s report, please view online at: ComReal’s Miami Industrial Real Estate Report for the 3rd Quarter of 2017. >>>
Featured Property: The 234,739 sq. ft. Miami Freezer/Cooler Building for Sale!
At an impressive size of 234,739 sq. ft., this is the largest warehouse in Miami currently listed on-the-market for sale. The building’s freezers and coolers make it ideal for an owner-user in the perishables industry, however it could also be great for dry distribution, manufacturing, etc. Investors may also be attracted to this multi-bay warehouse and the seller may consider leasing-back a portion. The property is halfway between both PortMiami and Port Everglades just off I-95. For details on this ComReal exclusive listing, please visit The Miami Freezer Warehouse Building for Sale. >>>
Our customers are “cool!” TransInternational Cargo expands it’s flower distribution operation to 26k SF cooler warehouse space closer to Miami Int’l. Airport.
Miami Warehouses Sold in 4th Quarter 2017 (partial list):
|Buyer||Size SF||Property Address||Sale Price||$ PSF|
|Foundry Commercial and American Realty Advisors||823,000||2305 NW 107 Avenue||$85,500,000||$104|
|COFE Properties||373,000||Portfolio of properties||$32,500,000||$87|
|Terranova||232,919||7777 NW 41 Street||$40,270,000||$173|
|Rok Acquisitions||150,000||15801 NW 49 Avenue||$8,800,000||$58|
|Foundry Commercial and American Realty Advisors||134,175||8200-8290 NW 27 Street||$22,800,000||$170|
|Mandich Group||133,000||501 NE 183 Street||$9,620,000||$72|
|CenterPoint Properties||130,000||3355 NW 114 Street||$17,500,000||$135|
|Longpoint Realty Partners||39,050||3055 NW 84 Avenue||$5,875,000||$150|
|Terreno Realty||37,729||1480 NW 94 Avenue||$6,800,000||$180|
|Touton Florida Warehouse||30,074||2805 NW 75 Avenue||$3,005,000||$100|
Miami Warehouses Leased in 4th Quarter 2017 (partial list):
|Tenant Name||Size SF||Property Address|
|Eco Windows||182,000||9001 NW 87 Avenue|
|Ross Logistics||115,000||6695 NW 36 Avenue|
|Vertilux||110,000||7750 NW 79 Place|
|Pro Intermodal||104,616||15002 NW 107 Avenue|
|Monat Global Corp*||87,531||3450 NW 115 Avenue|
|Pan Ocean Freight*||80,210||725 SE 9 Court|
|Amcar Freight||82,000||12600 NW 25 Street|
|Expolanka USA||56,000||2100 NW 97 Avenue|
|KSI Trading Corporation||42,000||14350 NW 56 Court|
* Deals closed by the ComReal Miami Industrial Team
Two more happy customers! Pan Ocean Freight swiftly back-filled an 80k SF warehouse space at Miami International Logistics Center in Hialeah owned by Lincoln Property Group immediately after the prior tenant terminated it’s lease.
News Release: 87,531 sq. ft. Warehouse at Turnpike Logistics Center 100% Leased!
ComReal completely leased up the 87,531 sq. ft. warehouse building known as The Turnpike Logistics Center located in Doral to a single tenant in the international skin care production and distribution industry. The landlord is Seagis Property Group. The value of this lease transaction was about $3.5M. For more information on the story, please visit Florida Turnpike Logistics Center Warehouse in Doral. >>>
Congratulations to Patricia Quintana, CCIM who leased 12k SF of office space on Doral Boulevard to US Health Exchange
Service Provider of the Quarter: Sirius Business Advisors
Sirius Business Advisors is the only business brokerage firm in Miami that we are comfortable in recommending to our clients. If you are looking to buy or sell a business opportunity then Sirius has the solution for mergers, acquisitions, add-on opportunities, etc. Please consider letting ComReal handle your commercial real estate needs along with Sirius for your business needs. Contact our friends Michael Weihl and Richard Leal with Sirius Business Brokers at 844-747-4875 and/or via their website at www.siriusbusinessadvisors.com. >>>