Lauderdale has seen negative absorption
in the retail sector, says Michael Fay,
president of Colliers Abood Wood-Fay in
Coral Gables.
“It’s minimal, but this is the first time.
It’s just a signal that there is weakness in
the market,” Fay says, adding that Miami
is one of the nation’s most under-retailed
markets based on population.
Vacancy rates throughout the region
have not changed much over the past
year at around 3%. Average triple-net
rents were $20 per sf in Broward County
and $30 per sf in Miami-Dade County,
according to research reports.
“We’ve seen a slight softening of demand, but overall fundamentals are still
solid,” says Greg Masin, senior director
of retail at Cushman & Wakefield.
Experts expect the market to pick up
again, but in the meantime retailers are
being more selective when considering
store locations. There is a little more concern about cannibalizing a store because
of proximity, Masin says, adding that this
cautious attitude is the general trend
when a market softens.
Differences between the Broward and
Miami-Dade County retail markets are fading, although Miami maintains a slightly
different socioeconomic background and
has greater population density he says.
The highest retail rental rates in the area
are located in South Beach (see Market
Snapshot, page 13), followed by Miracle
Mile in Coral Gables, Las Olas in Ft. Lauderdale, Weston in Broward County and
Pine Crest in southern Dade County, according to Cushman & Wakefield reports.
Despite the slight softening, retailers
will continue to enter the South Florida
market, with Kohl’s and Dick’s Sporting
Goods, two large anchor tenants making
their way into the scene, according to
Masin. The economic slowdown may
create second thoughts by some exping
retailers, but generally won’t stop big-box
chains such as Target, Wal-Mart, Staples
and Best Buy from searching for and buying up prime locations.
“They’re going to be more selective in
their site process, but if it’s a good location they will take it,” Fay says of the
larger retailers. He points to Kohl’s recent
signing of a 96,000-sf lease at Miramar
Parkway and Flamingo Road, and Ashley
Furniture HomeStore’s 52,067-sf lease at
Sheridan Street and Dykes Road.
FUTURE REMAINS SOLID
Brokers believe the future of retail
remains solid because of in migration
and barriers to entry due to a lack of
available land.
“Well-located existing centers are going
to be able to maintain their occupancy
levels and eventually backfill any vacancy
that occurs,” Masin says. “New development for retail will likely be in the form of
a component of mixed-use projects.”
One such project, Park Square at
Doral, by Shoma Development Corp., is
expected to open by the third quarter of
2009 and include 150,000 sf of retail with
250,000 sf of class A office and a projected 1,000 residential units. Retail experts say this type of development is
expected to continue in select markets
throughout South Florida, and is part of
more than three million sf of retail product now under construction.—REFLA
Miramar Centre III
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We are pleased to announce the following new leases:
Cbeyond Communications, LLC
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INTTRA, Inc.
Represented by Keith Edelman of The Staubach Company
JPMorgan Chase Bank, N.A.
Represented by Paul Marko & Scott Allen of CBRE
Lockton Companies, Inc.
Represented by Robert Orban and Carter Hopkins
of Trammell Crow
Mattel Latin America HQ, Inc.
Represented by Sandra Andersen and Alice Lucia of
Jones Lang LaSalle
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