Retail landlords across South Florida had a steady ride for the first six months of this year, with vacancy rates in the low single digits amid some rent growth, according to a new report.
Institutional investors also pumped up the tri-county retail market by going on a shopping center buying spree since the spring. Second quarter buyers included Pine Tree, a Northbrook, Illinois-based retail-focused real estate investment firm that made its first plunge into the South Florida market. Last month, Pine Tree paid $70 million for The Fountains, a shopping center in Plantation anchored by Kohl’s, Dick’s Sporting Goods and Marshall’s big box stores.
Meanwhile, during the start of the second quarter, real estate investors like New York’s Gindi family and Crunch Fitness founder Doug Levine cashed out of retail buildings in Miami’s Design District and Wynwood, respectively. In April, the Gindi family’s ASG Equities sold a single-story building fully leased to two tenants at 70 and 74 Northeast 40th Street for $14 million. The same month, Levine sold three commercial buildings at 2320-2328 North Miami Avenue and 36-38 Northwest 24th Street for $23.5 million.
Miami-Dade County
Landlords in Miami-Dade County bumped the median asking rent to $45.26 a square foot in the second quarter, compared to $43.67 a square foot during the same period of last year, the report by Colliers shows. The vacancy rate stayed flat year-over-year, with an overall high occupancy rate. In the second quarter, Miami-Dade’s vacancy rate hit 3.1 percent, compared to 3 percent during the same period of last year.
However, new retail construction slowed down. In the second quarter, developers built 1 million square feet of new retail space, compared to 1.7 million during the same period of last year, according to Colliers.
Notable lease signings during the second quarter took place in the Miami Design District. Last month, Craig Robins’ Dacra scored a handful of luxury tenant signings. Fashion brand Brunello Cucinelli, jeweler Isabella Grutman, Tiffany & Co. and clothing and accessories boutique Palm Angels opened stores spanning 14,100 square feet in the fashion, arts and fine dining neighborhood.
Broward County
In Broward County, landlords slightly increased the median asking rent to $28.93 in the second quarter, compared with $27.71 a square foot during the same period of last year, the report shows. Slightly more empty spaces also appeared, as the vacancy rate in Broward hit 4 percent, compared to 3.5 percent during the same period of last year.
New construction is also up, year-over-year. Developers added 808,000 square feet of new retail space during the second quarter, compared to 669,000 square feet during the same period of last year.
During the second quarter, Publix expanded its Broward retail portfolio. In May, the Lakeland, Florida-based grocery chain paid $58.5 million for Ramblewood Square Shopping Center in Coral Springs. The fully-leased property is anchored by a Publix supermarket.
Palm Beach County
The median asking rent in Palm Beach County dipped a few cents, year-over-year, clocking in at $29.42 a square foot in the second quarter, compared to $29.59 during the same period of last year, according to Colliers. Meanwhile, the vacancy rate inched up to 3.6 percent in the second quarter, compared to 3.4 percent during the same period of last year.
New construction remained relatively unchanged. In the second quarter, developers added 260,000 square feet of new retail space, compared to 243,000 square feet added during the same period of last year, the report shows.
West Palm Beach-based NDT and Miami-based Place Projects, led by Joe Furst, developers of Nora District in downtown West Palm Beach, picked up new tenants in the second quarter. In May, the joint venture landed Cameron Mitchell Restaurants’ Del Mar, Sana Skin Studio, women’s clothing and accessories store Mint and The Spot Barbershop.