Medical offices demand shifts to Coral Gables

With the Kendall area approaching saturation, Coral Gables has emerged as a key beneficiary of heightened demand for medical offices.

Kendall’s medical office market has tightened significantly, with vacancies dropping to just 3.9% during this year’s third quarter, according to Colliers South Florida. With only 3.8 million square feet of inventory and no new space opened since 2022, limited availability has prompted many tenants to expand their searches northward into Coral Gables, where a broader range of options is available.

With metabolic health center Well by Messer securing a lease for 5,417 square feet at The Offices at Merrick Park in Coral Gables, there is a clear migration of medical users toward Coral Gables as availability, said Stephen Rutchik, Colliers’ vice chairman.

Coral Gables’ medical office vacancy measured 7.4% in the third quarter, providing valuable flexibility for expanding healthcare users, he said. Leasing activity has surged since early 2024, reaching a peak of more than 48,000 square feet in the second quarter of 2024 and maintaining steady momentum with over 30,000 square feet so far this year.

With no new medical office developments underway in either Kendall or Coral Gables, competition for quality space is poised to intensify, driving rent growth and underscoring Coral Gables’ position as a sought-after destination for tenants seeking expansion opportunities beyond the tightly constrained Kendall market, Mr. Rutchik said.

Earlier this year, Mr. Rutchik said, he represented Nicklaus Children’s Health System in securing a 63,277-square-foot lease of medical office space at Columbus Center, further exemplifying the Coral Gables market’s growing appeal among medical tenants.