Miami’s Brickell and downtown West Palm Beach continued setting the pace for South Florida’s office market’s momentum in the final quarter of last year, according to a recently released report.
Average rents rose across the tri-county region in the fourth quarter, Avison Young’s report shows. Miami-Dade and Palm Beach counties’ vacancy rates fell year-over-year, while Broward County’s vacancy rate increased slightly.
Landlords in some suburban submarkets in the tri-county region had a harder time landing tenants, despite having some of the lowest average asking rents.
Miami-Dade County
The office vacancy rate in Miami-Dade dipped to 14.9 percent in the fourth quarter, compared to 16 percent during the same period of 2021, the report shows. And the average asking rent climbed to $53.17 a square foot, an increase of $8.13 compared to fourth quarter 2021.
Miami Beach had the highest average asking rent in Miami-Dade in the fourth quarter, at $96.25 a square foot, and the South Dade submarket had the lowest average asking rent at $28.96 a square foot. However, South Dade had the highest vacancy rate in the county at 53 percent.
Led by the fully pre-leased 830 Brickell office tower under construction, the Brickell submarket had Miami-Dade’s lowest vacancy rate, 11.9 percent, in 2022’s fourth quarter. The Plaza Coral Gables mixed-use project signed the quarter’s biggest lease of 100,732 square feet for Bacardi.
Broward County
Landlords in Broward jacked up the average asking rent to $37.73 in the fourth quarter of last year, a $2.43 bump compared to the same period in 2021, according to Avison Young. Meanwhile, the county’s office vacancy rate rose slightly to 17.2 percent compared to 16.9 percent during the same period two years ago.
In the fourth quarter, the Hallandale submarket had Broward’s highest average asking rent at $52.90 per square foot, and the county’s highest vacancy rate at 37.7 percent. Downtown Fort Lauderdale had the second highest average asking rent at $48.78 a square foot, and the second highest vacancy rate at 21 percent, the report shows.
Hollywood’s 11.9 vacancy rate was the lowest in Broward, and the Pompano Beach/Deerfield Beach submarket had the lowest average asking rent at $30.88 a square foot.
Palm Beach County
The vacancy rate in Palm Beach County dropped to 10.7 percent in the fourth quarter of last year, compared to 13.2 percent during the same period in 2021, the report shows. The average asking rent jumped to $42.81 a square foot, compared to $39.86 a square foot during the same period in 2021.
Downtown West Palm Beach, where Stephen Ross’ Related Companies has cornered the office market, had the county’s lowest vacancy rate of 12.5 percent in the fourth quarter. But the average asking rent of $64.86 a square foot came in second to the city of Palm Beach, where office landlords are seeking average asking rents of $79.04 a square foot.
In the last quarter of 2022, Palm Springs/Lake Worth was the county’s submarket with the highest vacancy rate at 24.4 percent, despite having the second lowest average asking rent of $34.65 a square foot.