Sometimes the obvious fundamentals don't always tell the story.
For example, JLL's fourth quarter market report on Miami Dade County analyzing the area's industrial sector showed that net absorption turned negative at -483,906 square feet for the last three months of 2024. Add that to the vacancy rate ticking up 110 basis points to five percent and deliveries totaling over seven million square feet, which JLL refers to as an "abundant" amount of supply.
"For the first time since 2020, the influx of new supply has surpassed absorption," the CRE firm said.
You would think that's not a great sign, but not necessarily. Most importantly, consider the "underlying market fundamentals," which are still "strong," according to JLL. This includes Class A industrial assets experiencing "peak vacancy rates" thanks to recent completions. Also, net absorption for the full year was positive at about 1.18 billion square feet.
In the fourth quarter, there were also some major deals made. SteelCorp Factory signed the largest lease, taking 164,080 space at Flagler Station. That was followed by Double Ace Cargo's 148,618 square-foot deal at the Miami International Commerce Center. For sales, The Easton Group made the largest purchase for a new facility called Northwest Dade Logistics Center, costing about $58.29 million.
JLL provided a mixed outlook for Miami-Dade's industrial sector. What's unclear is what will happen with vacancy exactly, as the category is expected to "fluctuate" in the county. But on the bright side, the Chicago-based firm said institutional capital will continue pouring in, and rents are projected to grow steadily, which averaged $16.07 per square foot in the fourth quarter.
"Miami's economic expansion is fueled by its prime positioning, offering connectivity to local and global commerce routes via Miami International Airport and Port of Miami," JLL said.