NEW-Miami Occupier and Pricing Trends_C&W Q3 2023 RFS
SUBURBAN EXECUTED LEASING ACTIVITY SELECTED TRANSACTIONS, Q2-Q3 2023
SUBURBAN OVERVIEW
Total SF Leased
Submarket
Building
Tenant
Business Sector
SUPPLY HIGHLIGHTS No major suburban office buildings have yet to deliver in 2023, with one small 46,000-sf completion in the Wynwood, Design District & Midtown submarket. This has limited any significant increases in vacancy, with the suburban office sector seeing a miniscule 10-bp YOY increase to 16.0%. For most suburban submarkets, supply and demand remained balanced throughout the year. Over 732,000 sf was under construction at the close of Q3 - with nearly 30.0% already spoken for. Approximately 70.0% of new office development in the suburban area fell within the Wynwood, Design District & Midtown submarket. Despite the slowdown in market fundamentals, projects expected to deliver over the next 24 months should not have a significant impact on increased vacancy.
Airport West
The Current
Simply Healthcare
54,755
Insurance Carriers
Biscayne/Wynwood/ Design District
Performing Arts Companies
545Wyn
Sony Music
44,742
Biscayne/Wynwood/ Design District
Other Financial Investment Activities
545Wyn
Miami Exchange
38,409
BIOTISSUE HOLDINGS INC., f/k/a Tissuetech, Inc.
Specialized Design Services
Airport West
The Landing - Bldg 8
34,831
Coral Gables
Colonnade Office Tower
Ryder System
33,798
General Freight Trucking
Architectural, Engineering, and Related Services
Airport West
6101 Waterford
Pike Engineering
23,357
OFFICE MARKET STATISTICS | Q3 2023
Coral Gables
Alhambra Towers
21,834
YTD Completions
Under Construction
Existing Inventory SF
Direct Vacancy %
Total Vacancy %
YTD Net Absorption
Average Direct RR PSF Quoted
Coral Gables
The Plaza Coral Gables - North Tower Hinshaw & Culbertson LLP
21,376
Legal Services
Suburban Class A Suburban Class B
46,678
403,650 13,463,508
17.8% 18.3% 64,063
$49.79
Airport West
1000 Waterford
United Health
19,149
Insurance Carriers
0
329,000 13,492,016
13.1% 13.7% 4,594
$39.86
Advertising, Public Relations, and Related Services
Coconut Grove
First Citizens Bank Tower
Alma DDB
17,945
Totals
46,678
732,650 26,955,524 15.4% 16.0% 68,657
$45.04
Suburban Executed Lease
CBD Executed Lease
Brickell Executed Lease
Downtown Executed Lease
Aventura Executed Lease
3% 4%
8%
3%
SUBURBAN LEASING ACTIVITY BY TENANT INDUSTRY YTD % OF TOTAL SF LEASED BY EMPLOYMENT INDUSTRY
DEMAND HIGHLIGHTS 2023 marked a shift in demand from the CBD back to suburban submarkets where over 68,000 sf of net occupancy gains were recorded so far for the year. Over 93.0% of this came from Class A space as the flight to quality still held throughout the market. Class B inventory continued to see more of a balance between demand and supply with a modest 4,500 sf of positive net absorption. Nearly 375,000 sf of new deals were signed during Q3, combining for more than 1.2 msf YTD of new leasing activity through the first three quarters. This was down 28.6% from lease deals reported through Q3 one year ago. Class A space continued to dominate demand with over 58.5% of all deals done being reported in high-end suburban office space. Three submarkets surpassed the 200,000-sf mark with Airport West leading the charge with more than 35.6% of Miami market deals. PRICING HIGHLIGHTS The suburbs’ direct average asking rate growth has slowed, increasing by 40 bps YOY to $44.69 psf FSG with both classes of space experiencing modest growth over the past four quarters. Landlords have yet to concede on asking rents, but have lessened quarterly rate hikes in the suburban submarkets. Class A product increased 2.5% YOY to just under the $50.00 psf FSG mark while Class B space recorded a more improved 3.1% YOY increase to $39.53 psf FSG. Asking rents will likely see milder increases over the next 12 to 18 months. Coral Gables Executed Lease Coconut Grove Executed Lease
17%
22%
Hospitality & Leisure
F.I.R.E
Healthcare
Manufacturing
Legal
Government
4%
Tech
Business Services
Construction
3%
36%
Airport West Executed Lease Quoted Rate PSF SUBURBAN - AVERAGE DIRECT RENTAL RATES, 2013 - Q3 Miami Beach Executed Lease
Kendall Executed Lease
$0.00 $10.00 $20.00 $30.00 $40.00 $50.00 $60.00
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
Class A
Class B
Class A Class B
Cushman & Wakefield of Florida, LLC. / 13
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