Posts Tagged ‘ComReal Miami Inc.’

Is the Miami industrial real estate market back in 2010?

If the first quarter will be of any indication for the rest of the year then the answer is absolutely YES! This quarter experienced a very significant amount of activity in the Miami industrial real estate market especially when compared to the prior quarters in 2009.

In the Airport West submarket, ComReal reports that ten (10) warehouse buildings of 20,000 sq. ft. and over have sold this quarter to owner users. That is more than all of last year! This is of great significance. It also appears that prices for both class A and B building have stabilized. Only two of those sales were considered distressed. For details on each of the Miami warehouse buildings that sold see below and/or call us for discussion.

In regards to leasing activity, ComReal tracked thirteen (13) leases executed for warehouse spaces over 25,000 sq. ft. in the Miami industrial real estate market. (These warehouse spaces were class A and B only). Although leasing activity has increased, landlords are still offering major rental concessions such as free rent and tenant improvement allowances. We have been informed that one industrial park has actually increased their asking lease rate. The ComReal Miami Warehouse Team was responsible for over 200,000 sq. ft. of new lease transactions. Feel free to read more about the following stories:

• Armellini Leases Miami Warehouse Space>>
• Aggreko Leases Miami Industrial Property>>
• South Florida Warehouse Lease by MSI Stone Importer and Distributors>>
• Boston Med Devices Leases Warehouse at Miami Free Zone in Doral>>

The significant volume of sales and leasing activity this quarter may be a statement that the industrial market is beginning to stabilize. We really will not know until late into 2010 if this upward trend continues.

If you are considering the acquisition of new warehouse space, anytime in 2010 may be a good time to lease or purchase before purchase prices and lease rates begin to increase. One thing that may be for sure is that interest rates may increase so this is another reason to act soon. So if you identify a functional property that suits your business operation needs and it’s well priced, you ought to act expeditiously to get it under control.

ComReal Miami Welcomes Edison Vasquez to its Industrial Team

ComReal is pleased to announce the addition of Edison Vasquez to its Miami industrial real estate team. As a graduate from Florida International University’s (FIU) Master of International Real Estate, Edison is well positioned to assist clients in the transactions of commercial properties. Before joining ComReal Miami, Edison collaborated with several brokers in numerous transactions at Grubb & Ellis. Edison, a native from Ecuador, is fluent in Spanish which suits him well to serve Latin American business. “Miami is the gateway to business in Latin America and with my language and the support of a well established firm, such as ComReal Miami, the opportunities for growth are limitless.” states Mr. Vasquez.

ComReal Miami address change

The ComReal Miami office has moved to a new location in Doral. The new address is 9500 Doral Boulevard, Suite #103, Doral, Florida 33178. Our phone numbers and emails remain the same. Our website is www.ComRealMiami.com.

For over 30 years, The ComReal Companies have played an integral role in the commercial development of South Florida. The ComReal Miami office has always proudly been headquartered in The City of Doral. Now its main office will be at The 9500 Building adjacent to BBU Bank on the prestigious Doral Boulevard (NW 41st Street) across from the Doral Country Club.

Throughout its history, ComReal is credited with several major transactions along Doral Boulevard including Univision’s 153,000 sq. ft. facility, Miami-Dade County Fire Department’s acquisition of the 172,000 sq. ft. former Eastern Airlines Headquarters and the 127,000 sq. ft. IVAX facility. It is only fitting that ComReal now joins these impressive landmarks along Doral Boulevard.

Will 2010 be better, the same or worse?

Let’s first look at how we ended 2009. The average vacancy rate has slightly increased to 10.3% and lease rates have fallen to an average of $7.44 psf gross. The total amount of annual transactions for both leased and sold industrial properties have decreased significantly.

Many businesses remained in a holding pattern for the years 2008-2009. The more aggressive landlords are being forced to offer very significant rental concessions such as: six months of free rent; large tenant improvement allowances; and reduced rent. It is not uncommon for a landlord to offer the first year of a lease term at half-rate or just enough to cover their operating expenses. Financing both businesses and/or properties are still a concern, however there are enough lenders out there ready, willing and able to finance quality, credit owner-user applicants.

Overall, the industrial market in Miami has held up better than the other property-types such as office, retail, residential, etc. Listed below are some very significant trends that our team thinks will have an impact on Miami-Dade County’s industrial real estate in 2010:

• Until vacancy stabilizes and/or falls, there will continue to be low construction of additional warehouse space. This is good news for landlords who fear more competing buildings. The bad news is that many of the construction and building-supply businesses make up a large segment of tenants occupying warehouse space. Some have now had to downsize and/or close altogether. Others are looking into green retrofitting and construction, building other property-types altogether and/or exploring foreign markets. Read more on the impact of Green building from ComReal’s expert, Louise Bendix.

• The County’s unemployment rate is now 11.3%. Companies are looking for ways to keep employment costs down and will try to outsource much of their business where possible. (Example: some 3^rd party logistics companies have seen their business increase significantly). The good news is that there is an abundance of good, talented employees available to hire.

• Watch the retail market. Less consumer spending means lower demand for retail products and therefore less inventory will be stored in nearby warehouse spaces.

• Follow the money. Where are our tax dollars going? One of our best customers in the service & repair industry was seeking about 100,000 sq. ft. of warehouse space here in Miami. However, they decided to instead move their operation to the Midwest in order to receive federal stimulus money and incentives such as warehouse space for only $1.00 psf and free training for their employees. Sorry Miami!

• BIG government means BIG demand for commercial real estate. Government agencies continue to grow and acquire more industrial properties including Miami-Dade County Animal Services Department that is seeking to purchase a 50,000 square foot industrial building. Yes, this is true. Even in a recession, the County must have a new state-of-the-art dog pound!

• Our new word for 2010: “re-purposing”. Class C and other dis-functional warehouse buildings may either become obsolete or need to be “re-purposed” as they have done in the Wynwood and Design Districts. Green retrofitting is for real and must be seriously considered. It is all about making commercial properties more operationally efficient and reducing utilities expenses. Buildings that have been neglected, have major defaults and/or are in desperate need of repair will see the most significant decrease in value. Perhaps they will even be worth less than their land value if the buildings need to be demolished. Warehouse users prefer more functional, class A buildings with higher ceilings, security systems and overall good construction, such as Beacon 97^th Avenue Business Park in Doral.

• Speaking of “re-purposing”, we are also seeing this trend in our commercial real estate profession. Many CRE brokers are retooling and reeducating themselves. According to the Florida Association of Realtors, membership is down by about one-third for those who have moved on to other careers.

• There are several major construction projects that will significantly shape the future of our industrial warehouse market: 1) Port of Miami’s new Tunnel and it’s dredging of the channel to 50’ in depth. 2) Expansion of the interchange of the Dolphin (SR 836) and Palmetto (SR 826) Expressways; and also the construction of the 25th Street Viaduct which will allow cargo to move from MIA west into the City of Doral. 3) The addition of the 800,000 sq. ft. cargo facility and the Intermodal at Miami International Airport. 4) Prediction: rail-served warehouse buildings in Miami will see an increase in demand in the next couple years as products are imported to the Port of Miami and then railed further up north. Here is an 127,000 sq. ft. warehouse for lease or sale on the FEC Rail and adjacent to Miami International Airport: www.MiamiAirportWarehouse.com.

• Our customers report in each of their respective industries that federal, state, county and municipal government bureaucracy and taxation are all negatively influencing their businesses (No surprise here).

• “Miami: Gateway to the Americas”. Firms doing business on an international level still choose Miami due to its language capability, established trade routes and relationships abroad. We continue to see foreign companies locate a new warehouse facility in Miami for the primary purpose to do business with Central & Latin America and the Caribbean. ComReal is currently expanding a manufacturer from the Dominican Republic that values Miami’s air cargo routes to more international airports. A Canadian logistics company prefers a new Miami address so it can better enter and compete in the foreign markets of Brazil, Mexico, Colombia, and more.

As we can see, there are both positive and negative forces that can impact Miami’s industrial real estate market for better or for worse. Every industrial property and business is very unique.

For a free, confidential consultation, please feel free to contact Edward Redlich and The ComReal Warehouse Team anytime. We look forward to the opportunity to discuss your plans for 2010 and beyond.

After 30 years in the commercial real estate business, The ComReal Companies plan on another 30 years with the launch of their 2010 marketing campaign: “Got Space?”.

Whether you are seeking office space or warehouse space in Miami, always be sure to consider a ComReal professional, “The Office & Warehouse Space Experts”.

Visit our company website at www.ComReal.com.

For the past several years, I have had the honor of working with Mr. Michael Weihl. He joined The ComReal Companies because of its highest reputation within South Florida’s commercial real estate industry for over 30 years. Mr. Weihl and his team brings to us the same set of high ethical standards to the Miami businesses brokerage profession.ComReal is now also a leading intermediary of transaction services for the small and mid-sized business owner in South Florida.

Together we have formed a synergy amongst the commercial property and business specialists. Our customers are really beginning to value the duo-brokerage firm that ComReal has become and we are able to offer them expertise from two perspectives. Recently, a Canadian logistics firm decided to expand in the Miami market. They retained ComReal’s Industrial Real Estate Division to locate and acquire a warehouse space in Miami for lease. I met with the CEO and CFO here in Miami to discuss their business plan about logistics within Miami, Canada, Central and South America. After discussing and touring the Miami warehouse markert, it was determined that it was in their best interests to acquire an existing logistics company already in operation in Miami. This is where Mr. Weihl came into the consultation process. After learning more about their platform and requirements, he put together a campaign to acquire a Miami logistics business.

Presently, Mr. Weihl has several business opportunities for acquisition in the following industries: logistics, manufacturing, import, export, distribution and more. He also has several businesses looking for mergers and acquisitions in the Miami, South Florida area and beyond.

Please contact Michael Weihl, Business Broker & Specialist, of ComReal Miami, Inc. at 786-433-2503 or visit his website at www.MichaelWeihl.com. All discussions and consultations will be kept completely confidential.