This article will help anyone looking for information pertaining to a commercial real estate and commercial lending in the State of
Florida.
The Florida commercial real estate market has long been led
by oranges, its star agriculture crop, and that isn't likely to change.
What is likely to change is the price and location of Florida's agricultural
land. Previously, agriculture reigned through central Florida and down into
the southwest. However, with the significant influx of people, both from out
of state and off the Florida coasts, to Florida's interior, the central
agricultural land is being snapped up by residential developers. Residential
developers are paying enormous premiums for agricultural land, particularly
along the I-4 corridor, believing that the prices are justified by Florida's
impressive growth rates. Indeed, a recent University of Florida study predicts
that population growth in the next 50 years will require seven million acres
of land to be taken out of agricultural use and put to residential use. The
residential speculation is having the effect of driving up agricultural
land prices in the central and southeastern region and concentrating
the remaining croplands in the southwest. Another force moving agriculture out
of the interior is a water shortage. These shortages are expected to also hamper
residential development in the interior.
Southeast Florida, with its white sand beaches, celebrity hot spots and theme
parks, has long been a vacation destination, but it is more than that. As Miami
gains a reputation as a cosmopolitan city - a magnet to more than just
Caribbean and South American immigrants - it is attracting the attention
of big business. Retail, particularly high end boutique, recently
took off in Miami and Miami Beach, and that shows no sign of letting up. Another
indicator of business interest is the growth of Miami's office sector.
Current vacancy rates are just under 10% and subleased space has plummeted to
under 500,000 square feet. Much of the growth is driven by South American companies
setting up shop in the U.S., but an increasing portion of office space is being
taken up by European firms looking to Miami instead of New York or Boston. As
well, the office sector seems to be following the industrial sector quite closely,
and the Port of Miami has made Miami-Dade's industrial sector the largest
in southeast Florida. A good portion of Miami's office sector growth is
driven by population increases. For the first time, Miami is attracting young
people who set up residence and business, not just retirees or people with second
homes. For this demographic, office space is quickly being converted to mixed-use
office, retail and residential.