Miami-Dade reaches 100 million square feet of offices
One-ninth of Miami-Dade County’s total office space stood vacant as 2020 ended and the county for the first time crossed the line of 100 million total square feet of offices, a preliminary market report this week by Colliers International reveals.
Vacancies have been rising since Covid-19 hit the county in March, Colliers data show. Total office vacancies rose from 9.6% at the end of March to 10% at the end of June, 11% at the end of September and 11.3% at year’s end.
As some businesses close as a result of the pandemic-induced downturn and other businesses downsize office space as more employees work from home, more space is likely to go dark in coming months.
In 2020 as a whole, county space absorption was a negative 657,677 square feet, although there was a positive absorption of 239,708 square feet in the final quarter of the year, reducing the annual loss. By comparison, 2019 saw an absorption for the year of 209,889 square feet after an absorption of 128,973 the year before.
As the year ended, a total of 3,615,636 square feet of offices were under construction in the county. That represents upon completion an increase of more than 3.6% in total county office space.
Despite the pressures deterring filling offices in the pandemic, however, landlords continued a long unbroken string of quarterly hikes in asking office space rents. The current level for all office space is $42.16, up from $33.02 five years ago.
In Class A space alone, despite the pressures induced by the pandemic the asking price per foot was $48.33 at year’s end, an increase of 1.85% from the quarter before and 4.8% from a year earlier.
Hardest hit by the vacancies by far is Downtown Miami, where more than 6.9 million square feet of offices at the end of the year were 22.7% vacant. Asking rents were $45.12 per square foot overall and $47.08 in Class A space.
In neighboring Brickell, 13.2% of 7.6 million square feet of offices were vacant, yet asking rents were $57.70 overall and $63.79 for Class A space – both asking rental rates highest by far in the county, according to Colliers’ report.
The lowest asking rents in the county were in the 3.4-million-square-foot Miami Lakes market, which has 13% vacancy. Landlords there were seeking $26.19 overall and $28.11 in class A space.
The next lowest rents in the county were in Medley/Hialeah market, which has by far the lowest vacancy in the county at 1.6%. Asking rents there were $29.57 overall.