Posted on August 2, 2022 · Posted in Industrial / Flex, Investments, Retail

A New York-based analyst and broker said demand for South Florida’s industrial market is so strong that rising interest rates will hardly slow it down. At least, not yet.

William Brooks, an associate at B+E Net Lease, said the possibility of Amazon pulling back on some warehouse space in South Florida and elsewhere isn’t likely to have a negative impact on the value of industrial space. That’s because there are scores of industrial tenants ready to take the Seattle-based e-commerce juggernaut’s place.

For some industrial developers, that means it still makes sense to seek out opportunities to build new warehouse and storage facilities.

Local experts, on the other hand, have told the Business Journal that rising interest rates will likely slow down the buying and selling of industrial properties in South Florida.

Brian Smith, JLL‘s managing executive director and industrial lead in South Florida, agreed that “demand is outpacing supply by a lot,” resulting in significant growth in rental rates and record-low vacancies.

In Miami-Dade, asking rates for industrial space increased 76% year over year, to an average of $13.50 a square foot in the second quarter, according to a recent report from JLL. In Palm Beach County, year-over-year rents increased 22% to $11.49 a square foot over that same time. In Broward, average asking rents increased to $11.90 a square foot.

However, Smith said, rising interest rates and uncertainty in the economy is affecting the investment side.

 

Source: SFBJ

About the Author