The sales and leasing activity remained steady for Miami’s industrial real estate market in the 3rd quarter of this year. Vacancy rates decreased slightly to 8.4% during this period while the average lease rates increased slightly to $7.15 per square foot. In comparison, the national averages are 9.6% and $5.13 psf respectively. The past and present facts in this report may provide us with some optimism for both the Miami industrial real estate market and the local economy.

The only newly-constructed warehouse to mention is GOYA’s completion of their 338,000 sq. ft. warehouse located at 13300 Northwest 25th Street. However, the most significant news is the announcements of four new construction projects of bulk-sized, Class A warehouse buildings by institutional investors, totaling just over 1,000,000 sq. ft. Three of the developments are within walking distance of each other. What is even more amazing is the fact that all of the following warehouses are being constructed entirely on a speculative basis!

You might be asking yourself right now if there is enough recent activity to encourage spec development? Our conservative response is “probably yes”. If a company is seeking to lease over 50,000 sq. ft. in these sub-markets there are less than ten choices right now with several prospects now currently in the market looking. Perhaps the most recent, closed deals in these sub-markets are the best indication of the near future. Check out this list of all of the leasing and sales transactions in the past six months of 25,000+ sq. ft. warehouses in Airport West and Medley.

Warehouses Leased:

Warehouses Sold:

Graph for Asking Prices for Miami-Dade County Industrial Properties

So after several years of zero speculative construction, what else has caused the institutions to become even more bullish on Miami? The reasons are that land values are low enough to make for attractive acquisition opportunities which is exactly as ComReal predicted in its 2010 Year-End Industrial Market Report >>>

Institutional investment companies are looking at the global picture which includes the expansion of the Panama Canal and the recent passing of the Foreign Trade Agreements (FTA’s) with Panama, Colombia and South Korea. Miami is preparing by making major upgrades to its transportation infrastructure including renovation of the Palmetto (SR826) and Dolphin (SR 836) Expressways ( www.826-836.com ) ; deep dredging the Port of Miami channel to 50’; repairing the FEC Railway; new construction of the Miami Tunnel and the Miami Intermodal Center (www.micdot.com); and new terminals at Miami International Airport. According to Miami-Dade County’s Office of Economic Development and International Trade (OEDIT) , “The airport and seaport continue to see consistent double-digit, year-over-year gains in international trade.” All of these transformations are expected to have a major, collective impact on Miami’s warehouse industry. The essence of Miami’s industrial market is truly about exploiting its international trade routes and relationships.

To learn of other trends and activity details, please contact ComReal’s Industrial Real Estate Team at 786-433-2380 and/or visit www.MiamiWarehouseTeam.com. We are always available for a friendly, but confidential discussion in regards to evaluating your warehouse space needs and business opportunities.

WAREHOUSE CONDOS IN MIAMI AIRPORT WEST DADE

The Third Quarter ended fairly stable with sales prices for class A warehouse condos in the Miami Airport West Dade sub-market at approximately $138 per sq. ft. There were no known sales for this quarter, however ComReal Miami did sell the property at 8565 NW 29 Street in Beacon Centre North for $787,000 or $109 per sq. ft. in June.

For those companies leasing class A warehouse condos in Doral, average lease rates should be around $8.25 to $8.50 per sq. ft. quoted as an industrial gross amount. In the last quarter, two known leases were completed within the Airport West Dade, class A condo parks. The leasing of 30,000 sq. ft. in Doral Commerce Park at $7.50 per sq. ft., and 8,700 sq. ft. in the International Corporate Park at $10.95 per sq. ft. Going hand in hand with the lease rates, the vacancy rate at the end of the quarter is 13.1% and is inching its way down.

For a more detailed study of Miami Airport West Dade Class A Warehouse Condos, please call Dan Berkovitz at 786-433-2098 or email at dberkovitz@comreal.com.

PRESS RELEASES !!!

ComReal represented 1 Sale A Day, an e-commerce company, in their relocation from New York to lease a 100,000+ sq. ft. warehouse space in Miami Lakes. Read more about the deal about the Miami Lakes Warehouse >>>

Sterling Transportation, Inc. moved from Medley to lease 28,500 sq. ft. on a long term basis. ComReal represented the owner. Read more about the distribution warehouse in Doral >>>

WAREHOUSE IN HIALEAH FOR SALE

ComReal has just listed a 57,000 sq. ft. warehouse that can be sold to an investor or an owner/user. For more details, please read further about the Hialeah warehouse for sale >>>

<< Click for larger view of Miami Industrial Real Estate Graph>>

Welcome to 2011. In these times of uncertainty, you may always rely on the fact that ComReal’s quarterly reports for the Miami industrial real estate market are both a valuable resource for your business and always refreshingly candid. Enclosed you will find specific examples, backup data and our professional opinion of trends in the market. We start off by stating two of the more significant statistics for 2010 overall. First, the vacancy fell by about two points to about 9%. Secondly, the overall activity for both leasing and sales increased significantly from the prior two years. If these trends continue into 2011, we will likely see lease rates and purchase prices stabilize; perhaps even increase. However, much depends on our national economy and the international trade industry which affects Miami so dramatically.

Of all of the real estate property types in Miami, the industrial category seems to be the most active. However, for buyers and tenants, the best deals may be behind us. The “early majority” of end-users that recently acquired industrial real estate took advantage of the lower pricing and terms for the best properties. The “late majority” of end-users to come along in 2011 may expect higher pricing, higher interest rates and fewer good, functional properties to choose from.

If you are an end-user such as a manufacture or distribution company, there is an important trend that you ought to be aware of which we describe as the “Walmart-ization” of Miami’s warehouse market. What this means to you is that most of the larger warehouse properties are aggressively being acquired by institutional investment firms such as REIT’s. Only about 10% of warehouses in Miami are owner-occupied. If a good opportunity to buy a free-standing warehouse building comes along, you’d better buy it or you may not find another! Del Valle Brands Distribution timed the market perfectly in December by acquiring a 127,000 sq. ft. warehouse. At a purchase price of $7,650,000 (or $60 psf), this was the largest transaction by an owner-user in all of 2010. ComReal Miami was the only broker in the transaction and successfully created a win-win for both the buyer and seller.  << Read more here >>

Below is a list of Miami warehouse buildings sold in the sub-markets of Airport West Dade and Medley:

Address                                 Closed Date:     Sale Price            $ PSF        Size in Sq. Ft.
6400 NW 72 Avenue        January              $4,340,000              $115          37,562
11380 NW 34 Street         January             $6,700,000              $73           90,973
11401 NW 134 Street       January             $15,200,000            $57           268,000
11450 NW 34 Street         February           $2,500,000               $118        21,084
2900 NW 77 Court            February          $3,300,000               $86           38,042
8925 NW 26 Street           February          $2,000,000              $93            21,384
8150 NW 64 Street           March                $2,500,000             $48            52,000
8570 NW 68 Street          March                $1,800,000              $85            21,000
9955 NW 58 Street           March                $1,950,000             $113           17,203
1550 NW 96 Avenue        March                $1,810,000              $88            20,436
2250 NW 114 Avenue      March                $3,950,000              $135          29,257
7005 NW 46 Street          April                  $1,300,000              $69            18,944
1740 NW 69 Avenue        April                  $1,000,000              $23            43,168
7970 NW 56 Street          April                  $1,480,000              $52            28,224
8221 NW 54 Street          June                   $2,100,000             $50            41,581
3655 NW 115 Avenue      August              $3,661,000              $102          35,720
5460 NW 78 Avenue       July                     $710,000                $56           12,517
7301 NW 77 Street         August               $1,000,000             $61            16,284
7939 NW 84 Street         August              $67,000,000             $75           882,895
1850 NW 94 Avenue      September         $1,420,000               $89           15,856
7000 NW 33 Terrace      December           $7,650,000              $60           127,010
6990 NW 25 Street        December           $3,640,000              $70           52,000

Another significant statistic is that there is almost zero warehouse space under construction which will help increase the occupancy levels of existing warehouse. The best deal for industrial real estate right now is vacant land. This is because nobody else is buying it. The drawback is that lenders are very reluctant to finance, so your best bet is owner financing or pay all cash. Prices for vacant land are about half-off from peak levels in 2007. Within six months you may expect an announcement of a major, new construction project and by the year’s end a significant ground-breaking. There does appear to be a renewed sense of optimism as we commence this year. Some of this is credited to Governor Rick Scott’s “Florida is open for business” campaign and the Port of Miami’s three projects: the 50’ dredge, the FEC railroad and the tunnel.

Miami Logistics Business and Warehouse Sold!

Michael Weihl of ComBiz Miami in cooperation with the ComReal Miami Warehouse team successfully brokered the disposition of a Miami logistics business opportunity and warehouse space. The total transaction was valued at more than $4,000,000, involved six different companies and over 200,000 square feet of Miami warehouse space. << Read more here >>

Miami Cooler Warehouse Available

This Miami warehouse is complete with coolers making this an ideal refrigerated distribution center for perishables.  The total size of the space is 53,000 square feet including 11,000 sq. ft. of office space and 42,000 sq. ft. of warehouse space. The property is located at 2011 Northwest 70th Avenue in the Miami industrial real estate market located near Miami International Airport. According to MIA air cargo statistics: over 70% of perishables, 86% of flowers and 70% of fruits & vegetables are imported into the United States via MIA. Learn more by clicking here: Miami’s Air Cargo.

The refrigerated warehouse in Miami is now available for sub-lease for an asking rate of $8.50 per square foot, on an industrial gross basis. It was previously occupied by Dole Flowers, Sunburst Farms and Trans World Forwarding. The neighbors include Armellini Express, Mayrshon International, Flying Foods, Gate Gourmet and more. The warehouse space has ten dock height loading doors; 19′ clear ceilings and is fully sprinklered. This warehouse is ideal for the distribution of perishables, flowers, foods, beverages and produce.

For more information about this Miami cooler warehouse space and others, please contact The Miami Warehouse Team at 786-433-2380 and/or visit www.MiamiCoolerWarehouse.com

Sgt. Dan Berkovitz recruited to the Miami Warehouse Team.

Dan Berkovitz was born in Israel to an Israeli mother and Romanian-born father. After high-school, Dan joined the Marine Corps and served 4 years in supply/logistics within an artillery battalion. Dan was awarded the Navy Achievement Medal for superior performance of duty during his second tour overseas during Operation Iraqi Freedom by decongesting a heavily congested supply-chain system. This exemplifies Sergeant Berkovitz’s logistical knowledge, his tenacity to get the job done, and his leadership experience.

After the Marines, Dan Berkovitz went to college at Florida International University and graduated in 2010 with a Bachelor of Business Administration with a concentration in management. Dan has been the President of the Florida International University (FIU) Real Estate Student Association (RESA). He is now President of the Real Estate Alumni & Affinity Council for the FIU Alumni Association and School of Business alumni (2010) and member for the Greater Miami Jewish Federation Real Estate committee.

Industrial Real Estate Events

January 2011
Ed Redlich, Edison Vasquez and Dan Berkovitz attended the CCIM Miami Commercial Real Estate Outlook Conference. Visit www.MiamiCCIM.com.
January 2011
The Miami Warehouse Team and Michael Weihl attended the Commercial & Industrial Association of South Florida (CIASF) 2011 Industrial Market Report for Miami-Dade County. << Click here for the entire report >>

The Miami industrial real estate market becomes more vibrant while the sales and leasing of other types of real estate properties remain weak. Nearly 1M square feet of Miami warehouse space was absorbed in the 3rd quarter of 2010 decreasing the vacancy for the third consecutive quarter in a row to 9.3%. The average lease rate slightly decreased to $7.02 psf on an industrial gross basis.

List of major leases for warehouse spaces in Miami:

352,000 sq. ft. by Bel, Inc. at Lincoln Logistics Park, Medley
201,399 sq. ft. by DHL Global Forwarding at MICC, Doral
182,000 sq. ft. by Global Ventures Intl. in Miami Lakes
175,000 sq. ft. by Carnival Cruise Lines at Centergate, Gratigny
144,000 sq. ft. by Econocaribe Consolidators at Airport in Miami
121,979 sq. ft .by  County Wide of Miami at Flagler Station, Medley
101,600 sq. ft. by Cash & Carry at 5590 NW 163rd Street in Miami
70,825 sq. ft. by Manray Express at AMB Distribution, Hialeah
65,120 sq. ft. by Brightstar at Beacon Lakes, Airport West Dade
65,069 sq. ft. by Martainer at Beacon Lakes, Airport West Dade
60,000 sq. ft. by Amcar Freight at Beacon Lakes, Airport West Dade

Miami Industrial Properties Sales and Leasing Activity cont…

In Miami, ComReal is credited with Aggreko’s lease of 31,000 sq. ft. at 3601 NW 123rd Street in Gratigny and 24,000 sq. ft. by Boston Med Devices at 2315 NW 107th Avenue in the Miami Free Zone in Doral. ComReal procured two of the largest warehouse lease transactions so far this year in Broward County with the lease of 44,000 sq. ft. by the Drug Enforcement Agency in Meridian Business Park in Weston and the lease of 55,000 sq. ft. by MSI at the Atlantic Business Center in Pompano Beach.

There were two major sales in Miami. The 268,000 sq. ft. Turnpike Distribution Center located at 11401 NW 134th Street in Medley. The multi-tenanted, warehouse building sold for $15,200,000 or $56 psf at a 8.5% cap rate. The Seller was RREEF and the new owner is Cabot. Palmetto Distribution Center located at 8001 NW 79th Avenue in Medley comprised of six buildings totaling 880,543 sq. ft. was purchased by AMB after a bidding frenzy by two dozen prospective purchasers.  The final price was an impressive $66,500,000 or $75 psf. The cap rate was 5.9%. The multi-tenanted properties were 95% occupied.

Edward Redlich of ComReal, was interviewed by Globe Street. “This sale makes a statement. Here’s an institution acquiring a property and they are not looking at 2010. They are looking beyond. They paid a premium for this asset. This is good class B functional warehouse space. AMB is making an investment in the future of Miami’s industrial market.”

It is worth mentioning the significant sales in nearby Broward County as well. RREEF purchased four buildings at Weston Business Center for $65,000,000. Duke Realty Corporation paid $20,000,000 for two buildings totaling 113,000 sq. ft. plus some extra land in Pompano Beach.

If you are interested in more details on other closed lease and sale transactions and/or the Miami industrial real estate market in general, please call our team at 786-433-2380.

Commercial Real Estate Events

ComReal takes an active role in learning about the organizations and economic engines that power Miami’s industrial market. We met recently met with Enterprise Florida and also attended their workshop on globalizing websites. Below are some other events that we attended over the past few months.

Recently, our team toured the Port of Miami to get updates on the following projects: Miami Tunnel, FEC railroad and the 50’ deep drudge. Read more about these stories here: <<click here>>

We also toured the cargo and maintenance warehouses at Miami International Airport. It is amazing the amount of air cargo the MIA handles. To view the Miami air cargo statistics: <<click here>>

ComReal Miami’s team attends the Airport West Business Association meets every Monday to discuss annexations in the Miami Airport West Dade area. Learn more about this very important issue at: <<click here>>