Why Florida

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OFFICE Q4 2024 BROWARD

MARKET FUNDAMENTALS

ECONOMY The unemployment rate in Broward County was 3.2%, up 10 basis points (bps) year-over-year (YOY). Despite the slight uptick, Broward County was 100 bps below the national rate and boasted the second lowest unemployment rate among major Florida markets. SUPPLY Broward County’s overall vacancy was 15.2% at the end of Q4, down 20 bps YOY to the lowest rate since Q2 2022. Class A vacancy rose 110 bps over the past 12 months, with large tenant vacancies in suburban markets, including Citrix’s Q3 102,000-square-foot (sf) move out, driving the spike. Class A vacancy in the Central Business District (CBD) decreased 60 bps while the suburban submarkets rose 200 bps from the close of 2023. Overall CBD vacancy decreased 80 bps YOY to its lowest point since Q2 2020. Phase I of the T3 FAT Village project remained the only project under construction in Broward County. The office portion of the mixed-use project in Downtown Fort Lauderdale is slated to bring nearly 175,000 sf of new high-end space with a projected 2025 delivery. DEMAND

15.2% Vacancy Rate 27,974 YTD Net Absorption, SF $41.16 Asking Rent, PSF (Overall, All Property Classes)

YOY Chg

Outlook

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SPACE DEMAND / DELIVERIES

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ECONOMIC INDICATORS

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Thousands

YOY Chg

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1 Related Insights Cushman & Wakefield Research reports analyze economic and commercial real estate activity including supply, demand and pricing trends at the statewide, market and submarket levels. $32 $34 $36 $38 $40 $42 2020 New leasing activity in Broward County totaled nearly 1.4 million square feet (msf) at year end, down 16.5% from one year ago. Despite the slight YOY decrease, new deals aligned with 2020 levels, continuing a two-year trend of market stabilization after the strong demand in 2021 and 2022. Although demand growth slowed, lease renewals in Broward County totaled 931,415 sf in 2024, up 33.4% YOY, marking the highest recorded total over the past five years. Overall absorption in the market was 69,614 sf in Q4, pushing the annual total positive to 27,974 sf and highlighting the market’s equilibrium over the past year. The largest tenant occupancies in Q4 included Seacor’s 31,216 sf at the DCOTA Office Center and Crystal Cruises taking its second full floor of 15,206 sf at The Onyx Tower in Hallandale Beach. PRICING The overall average asking rate in Broward County was $41.16 per square foot (psf), up 4.6% YOY. The Downtown Fort Lauderdale submarket averaged $53.50 psf, with top tier Class A space finishing the year at $55.14 psf, up 6.7%. Although Broward recorded a YOY increase, asking rental rates began leveling off in the second half of 2024. Despite the increase in operating and build-out costs, the decrease in deal activity and lack of new trophy product in the market points to continued rent stabilization heading into 2025. Outlook 932K Broward County Employment 3.2% Broward County Unemployment Rate 4.2% U.S. Unemployment Rate Source:BLS

-600

2020

2021

Net Absorption, SF Construction Completions, SF

2022

2023

2024

OVERALL VACANCY & ASKING RENT

17%

15%

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13%

11%

2021

9%

2022

Asking Rent, $ PSF

7%

2023

2024

5%

Vacancy Rate

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