Market Overview

South Florida’s industrial real estate sector, which experienced remarkable growth during the pandemic, is now facing challenges in maintaining demand relative to the increasing supply of distribution spaces. According to a report by JLL, the first quarter of 2025 saw a slight increase in vacancy rates across various counties in the region as developers continued to deliver new properties.

Vacancy Rates and Leasing Activity by County

Miami-Dade County

In Miami-Dade County, the industrial vacancy rate rose to 5.5% this quarter, up from 5% the previous quarter. This increase is primarily attributed to the completion of new buildings. Nonetheless, the average asking rent in the area climbed to $16.58 per square foot.

Leasing activity remained robust, with approximately 2 million square feet leased through new agreements and renewals in the first three months of the year. Noteworthy transactions include:

• Performance Food Group: 229,285 square-foot lease at 3595 Northwest 125th Street.
• Garland Foods: 174,400 square-foot lease at Hilco Medley, a new Class A property.

Palm Beach County

Conversely, Palm Beach County has recorded less leasing activity, with only 100,000 square feet leased in the same period. The market has seen an expansion in available space, adding 1 million square feet this year and around 3 million square feet since 2023. As a result, the industrial vacancy rate in Palm Beach County has risen to 6.3%, with average asking rents at $14.27 per square foot.

Broward County

Broward County is a notable exception to this trend, reporting a vacancy rate of just 4.1%. Leasing activity proved strong here, totaling 950,000 square feet. The average lease rate in Broward stands at $16.29 per square foot. The largest new lease in the area was signed by Transpire Bio, which secured 139,020 square feet at the South Florida Distribution Center in Pembroke Pines.

Conclusion

The industrial real estate landscape in South Florida is currently undergoing a notable transformation, characterized by rising vacancy rates alongside solid leasing activity in certain areas. As the market adapts to new supply and changing demands, stakeholders will remain vigilant in navigating these evolving conditions.

Contact

For further insights into the commercial real estate market, reach out to Jeff Ostrowski.