Key Takeaways

Industrial

Miami-Dade County
• Rental rates continued to climb, reaching $17.00 PSF triple

23Q3
net, an increase of 6.9% QOQ.
• The vacancy rate increased 40-basis points QOQ to 2.6%,
caused by the delivery of 2.3M SF of new construction.
• Absorption dipped to negative 850K SF, based on the ongoing
influx of new deliveries.

YOY YOY Under YOY Direct WD Asking Lease YOY

Vacancy Rate Net Absorption Construction Rates (NNN)

2.6% FORECAST
-850K SF FORECAST
8.8M SF FORECAST
$16.68/SF FORECAST

Moderate Slow Down Caused by New Construction

In the third quarter 2023, the Miami Dade County industrial market showed signs of a moderate slowdown, largely based
on the influx of new construction. Vacancy rates increased, following a significant amount of negative absorption, caused
by the 2.3 million square feet of new construction. However, demand kept pace with supply, which helped push rental
rates up to an all-time high. The Miami Dade County industrial market is expected to level out based on low unemployment
rates, continued population growth, healthy labor market conditions and persistent tenant demand, although continued
economic uncertainty lingers.

Market Indicators Market Graph

2.1% 2.2% 4.579%
3,500,000 5.0%

3,000,000 4.5%
Unemployment GDP - Quarterly U.S. 10 Year
Rate % change yr/yr Treasury Note 2,500,000 4.0%

2,000,000 3.5%

Historic Comparison 1,500,000 3.0%

1,000,000 2.5%

22Q3 23Q2 23Q3 500,000 2.0%

Total Inventory 0 1.5%

230,250.5 233,100.6 235,569.2
(in Thousands of SF) -500,000 1.0%

New Supply -1,000,000 0.5%

774.2 1,192.2 2,332.9
(in Thousands of SF) -1,500,000 0.0%
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

Net Absorption 2020 2021 2022 2023

652.1 (503.9) (850.1)
(in Thousands of SF) Absorption New Supply Total Vacancy

Overall Vacancy 2.2% 2.2% 2.6% The industrial market in Miami-Dade County remained stable in the
third quarter of 2023, with a mixture of key indicators across the board.
Under The vacancy rate increased 40-basis points quarter-over-quarter and
Construction 8,490.3 9,701.8 8,794.5 net absorption posted negative 850,000 square feet due to 2.3 million
(in Thousands of SF) square feet of new construction. At the same time, strong leasing activity
Overall Direct Asking continues to push rental rates up. The flood of new-to-market tenants
$12.29 $15.90 $17.00 in conjunction with a healthy pipeline of new construction will keep the
Lease Rates (NNN)
market in good condition through the remainder of 2023.

Recent Transactions

Lease Lease Lease Sale Sale Sale

Bridge Point Doral S FL Logistics Cntr. Prologis Beacon lakes 5530 NW 32nd Ct Rail 71 3140 NW South River Dr
Medley/HG | 130k SF Airport East | 117k SF Airport West | 112k SF Miami Lakes | $168/SF Central Dade | $270/SF Airport East | $1.3K/SF
 Industrial
Miami-Dade County

23Q3
Executive Summary
The Miami-Dade County industrial market leased over 1.7 million The largest lease recorded was Frito Lay signing a new lease
square feet by third quarter-end, which helped push rental rates for 130,320 square feet at Building 6 of Bridge Point Doral,
up to $17.00 per square foot triple net, a 6.9 percent increase followed by FedEx signing a new lease for 116,896 square
quarter-over-quarter. At the same time, negative net absorption feet at Building 5 of South Florida Logistics Center. The third
dipped 850,000 square feet, due to the 2.3 million square feet of largest lease was Top Shipping Systems signing a new lease for
new construction that delivered over the quarter. This caused the 112,189 square feet at Building 9 of Prologis Beacon Lakes.
vacancy rate to increase, but only marginally, by 40-basis points up Additionally, sales activity picked up in the third quarter of
to 2.6 percent. Heading into the last quarter of 2023, it’s expected 2023. The largest sale transaction was a purchase by Walton
that the industrial market in Miami-Dade County will level out, as Street Capital who acquired the portfolio of three properties in
new construction gets leased up with ongoing tenant demand from the Miami Lakes/Hialeah submarket for a total of $51.5 million,
new and existing tenants. Additionally, the 8.8 million square feet or $168 per square foot. The second largest sale was Spiegel
under construction will help to relieve the market, where available Associates purchasing the Rail 71 building in the Central Dade
space options have been limited. Leasing activity was robust in the submarket for $34.4 million, or $270 per square foot.
third quarter of 2023 totaling more than 1.7 million square feet.

South Florida’s Past, Present and Future Industrial Market

Over the past four years, South Florida’s industrial market has
undergone significant transformation and is now in a phase of
stabilization. The COVID-19 pandemic brought about substantial Past, Present and Future
South Florida Industrial Market
changes, initially driving a surge in demand for industrial properties
as businesses sought extra space to meet increased population 16,000,000 6.0%

growth resulting in higher demand for most products. This was further 14,000,000
5.0%

exacerbated by international supply chain disruptions. Currently, 12,000,000

4.0%
10,000,000
the market features low vacancy rates and rising rents, though the
8,000,000 3.0%

era of annual double-digit rent hikes is fading as supply and demand 6,000,000
2.0%
recalibrate. Looking ahead, South Florida’s industrial sector remains 4,000,000

robust, characterized by tight market conditions and strong demand,

1.0%
2,000,000

driven by continued business migration, thriving tourism, and sustained -

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
0.0%

consumer needs. There are currently more than 12 million square 2019 2020
Under Construction
2021
Deliveries Vacancy
2022 2023

feet under construction in South Florida, however, land available for

Source: Colliers, Costar

continued new construction is limited. As such, industrial properties are

poised to remain valuable, and businesses are responding to higher
rents by automating warehouses and leasing more optimized spaces.

Shift Toward Smaller Industrial Deals

The current industrial market in South Florida is experiencing a shift in
Shift in South Florida Industrial Lease Sizes
deal sizes. Significant new development in recent years, has expanded Average Lease Size (2019 - 2023)
the industrial options available. This expansion has been fueled by
16,000
both population growth and the steady influx of new tenants into the
region, ensuring a sustained level of industrial demand. However, a
14,000

notable trend in the market is the decrease in the number of deals 12,000

exceeding 100,000 square feet. While demand remains high, businesses 10,000

are increasingly seeking smaller industrial spaces. For context, in the 8,000

third quarter of 2023, the average industrial deal size for South Florida 6,000

was 10,017 square feet, compared to 14,472 in the third quarter of 4,000

2021. This average can be further broken down by 12,323 square feet 2,000

in Miami-Dade County, 9,994 square feet in Broward County, and 5,455 -

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
square feet in Palm Beach County. This shift towards smaller deal sizes 2019 2020 2021 2022 2023

reflects a growing preference among businesses for more efficient Source: Colliers, Costar

and customized industrial spaces that can accommodate their specific

operational requirements while optimizing costs.

Colliers | Miami-Dade County | 23Q3 | Industrial Report

 Industrial
Miami-Dade County

23Q3
Significant Sales Activity
Address Size Buyer Sales Price

5530 NW 32nd Ct, 5400 & 5530 NW 32nd Ct

306,000 Walton Street Capital $51,500,000 ($168)
Portfolio (3 properties)

Rail 71 - 7201-7275 NE 4th Ave 127,562 Spiegel Associates $34,400,000 ($270)

Jose Francisco da Costa

3140 NW South River Dr 14,798 $18,850,000 ($1,274)
Gomez

14000-14048 SW 140th St 52,466 CoFe Properties $11,150,000 ($213)

WestPointe Business Park - 8855 NW 35th Ln 32,904 Terra Associates $9,700,000 ($295)

Significant Lease Activity

Address Size Tenant Type

Bridge Point Doral Bldg 6 - 3400 NW 107th Ave 130,320 Frito Lay New

South Florida Logistics Center Bldg 5 -

116,896 FedEx New
6715 NW 36th St

Prologis Beacon Lakes Bldg 9 - 12480 NW 25th St 112,189 Top Shipping Systems New

International Corporate Park Bldg 4 - Aeropost International Services,

106,313 New
9950 NW 17th St Inc.

Prologis Beacon Industrial Park Bldg 8 - 11010 NW

93,218 Carisam Expansion
30th St

Miami-Dade County Overall Market

Quarter Direct Total Net Absorp. Net New Under Mfg. Avg. Flex Avg.
Whse. Avg.
# of Total Direct Direct
& Vacancy Vacancy Current Absorp. Completions Construction Direct Asking
Buildings Inventory SF Rate NNN
Asking Asking Rate
Year % % Qtr. SF YTD SF SF SF Rate NNN NNN

2023 Q3 5,450 235,569,224 2.4% 2.6% (850,095) (151,231) 2,332,939 8,794,466 $16.68 $11.47 $25.36
2023 Q2 5,441 233,100,597 2.0% 2.2% (503,863) 698,864 1,192,173 9,701,768 $15.52 $11.26 $24.72
2023 Q1 5,433 231,908,424 1.6% 1.8% 1,202,727 1,202,727 1,113,837 9,505,358 $14.71 $10.03 $23.91
2022 Q4 5,425 230,794,587 1.7% 1.9% 1,185,476 6,064,388 580,222 9,292,974 $13.09 $10.89 $23.03
2022 Q3 5,422 230,250,476 2.0% 2.2% 652,148 4,878,912 774,177 8,490,270 $12.09 $10.25 $25.16
2022 Q2 5,419 229,520,398 2.2% 2.3% 2,829,849 4,226,764 2,255,502 8,908,760 $11.50 $10.25 $24.60
2022 Q1 5,411 227,264,896 2.6% 2.7% 1,396,915 1,396,915 1,730,829 7,399,120 $11.38 $10.17 $25.36
2021 Q4 5,403 225,608,174 2.6% 2.7% 1,570,440 7,207,022 1,034,093 7,041,947 $10.71 $9.37 $25.08
2021 Q3 5,395 224,574,081 2.9% 3.1% 1,732,739 5,636,582 953,684 5,975,117 $10.52 $9.43 $23.69
2021 Q2 5,392 223,632,358 3.3% 3.5% 1,516,680 3,903,843 100,523 6,625,755 $10.53 $9.43 $23.33
2021 Q1 5,391 223,572,084 3.9% 4.1% 2,387,163 2,387,163 2,126,481 3,366,957 $9.81 $6.32 $20.62
2020 Q4 5,384 221,495,905 4.2% 4.4% 1,506,318 2,748,229 961,074 4,173,712 $9.70 $7.00 $19.44
2020 Q3 5,375 220,534,831 4.5% 4.7% 640,247 1,241,911 273,360 3,788,078 $9.77 $8.20 $17.70

Bold Denotes Colliers Represented Transaction

Colliers | Miami-Dade County | 23Q3 | Industrial Report

 Industrial
Miami-Dade County

23Q3
Submarket Breakdown
Net Absorp. New Under Avg. Direct
# of Inventory Direct Total
Submarket & Property Type Current Qtr. Completions Construction Asking Rate
Buildings SF Vacancy % Vacancy %
SF SF SF NNN

Miami Airport West

Warehouse Distribution (WD) 754 38,792,878 3.8% 4.0% (231,912) 0 117,831 $19.00
Manufacturing (MF) 24 1,957,029 0.0% 0.0% 0 0 0 -
Flex (F) 128 5,289,497 3.6% 3.8% 46,017 0 40,141 $25.32

Medley / Hialeah Gardens

Warehouse Distribution (WD) 854 50,575,627 1.8% 2.3% (17,138) 1,025,933 5,681,890 $16.69
Manufacturing (MF) 64 3,642,347 0.4% 1.2% (26,000) 0 0 -
Flex (F) 60 1,993,070 1.0% 1.0% (7,604) 0 70,152 -

Central Dade
Warehouse Distribution (WD) 211 4,793,399 3.7% 4.2% (69,913) 0 85,376 $20.51
Manufacturing (MF) 10 378,224 0.0% 0.0% 0 0 0 -
Flex (F) 23 811,071 11.4% 11.9% 26,310 15,664 0 $23.44

Northeast Dade
Warehouse Distribution (WD) 643 33,779,565 2.5% 2.6% (330,845) 292,197 2,260,573 $14.96
Manufacturing (MF) 47 2,961,038 1.6% 1.6% 17,100 0 0 -
Flex (F) 36 1,386,295 6.6% 6.6% (11,642) 0 0 $30.00

Miami Lakes / Hialeah

Warehouse Distribution (WD) 885 29,571,084 1.7% 1.7% 58,984 0 505,518 $15.85
Manufacturing (MF) 145 6,496,893 4.4% 4.4% 12,590 0 0 $11.17
Flex (F) 40 1,518,998 0.1% 0.1% 0 0 0 $18.96

Miami Airport East

Warehouse Distribution (WD) 647 26,234,261 2.6% 2.8% (260,948) 999,145 0 $21.01
Manufacturing (MF) 32 1,494,625 0.0% 0.0% 0 0 0 $20.00
Flex (F) 45 2,104,732 2.8% 2.8% (10,123) 0 0 $28.29

South Dade
Warehouse Distribution (WD) 651 17,818,825 1.3% 1.3% (46,130) 0 32,985 $17.76
Manufacturing (MF) 37 1,218,227 0.0% 0.0% 4,970 0 0 -
Flex (F) 114 2,751,539 0.7% 0.8% (3,811) 0 0 $18.17

Colliers | Miami-Dade County | 23Q3 | Industrial Report

 Industrial
Miami-Dade County

23Q3
Submarket Map

Colliers | Miami-Dade County | 23Q3 | Industrial Report

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in revenue Senior Research Analyst
South Florida
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square feet
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under management
Senior Research Analyst
South Florida
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