Q2 2022 Miami Airport Industrial Report
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Submarket Analysis
Executive Briefing on Submarket (Flex R&D) Conditions
The average Asking Rent was $13.06 in the Miami Airport submarket
- Rent in the Miami metro was up 1.6% from Q3 2021.
- Miami Airport submarket had its fastest rent rate of increase since year-end 2011.
- Rent is expected to finish 2022 at $13.51 in the Miami Airport submarket.
The average Vacancy Rate was 3.6% in the Miami Airport submarket
- No vacancy change since Q3 2021 in the Miami Airport submarket.
- Vacancy is expected to finish 2022 at 3.7% in the Miami Airport submarket.
Submarket Overview
With 9.2 million square feet, amounting to 47.6% of the total metro inventory, the Miami Airport submarket is the largest of the seven distinct Miami submarkets identified by Reis’s researchers. In the nine-year period beginning with Q1 2012, there have been no additions to the submarket, and no space has been removed by developer activity.
Asking and Effective Rent
Asking rents advanced by 1.6% during the fourth quarter of 2021 to an average of $13.06, a level surpassed only by the South Central submarket’s $18.95. This increase is consistent with directional movements in each of the past four quarters, during which asking rents have climbed by a total of 3.6%. The Miami Airport submarket’s current asking rent levels are higher than the metro’s average of $12.05, while asking rent growth in the fourth quarter is equal to the metro average of 1.6%. Effective rents, which exclude the value of concessions offered to prospective tenants, advanced by 1.8% during the fourth quarter to an average of $12.19.
Competitive Inventory, Employment, Absorption
Total employment in the Miami metropolitan area grew by 19,300 jobs during the fourth quarter, while industrial employment expanded by 1,700. Since the beginning of Q1 2012, the average growth rate for industrial-using employment in Miami has been 0.5% per year, representing the average annual addition of 700 jobs. Over the same time period, the metro posted an average annual absorption rate of 124,300 square feet. During the fourth quarter, metropolitan absorption totaled 78,000 square feet, of which the Miami Airport submarket captured 2,000 square feet. This is the second consecutive quarter during which this submarket recorded positive absorption, amounting to 8,000 square feet since Q3 2021. Over the last four quarters, submarket absorption totaled negative 52,000 square feet; by comparison, the average annual absorption rate recorded since the beginning of Q1 2012 is 32,300 square feet. The submarket’s average vacancy rate held steady at 3.6% during the fourth quarter, which is equal to the long-term average, but 0.8 percentage points higher than the current metro average.
Executive Briefing on Submarket (Distribution) Conditions
The average Asking Rent was $9.03 in the Miami Airport submarket
- Rent in the Miami Airport submarket was up 1.8% from Q3 2021.
- Rent is expected to finish 2022 at $9.48 in the Miami Airport submarket.
The average Vacancy Rate was 4.8% in the Miami Airport submarket
- No vacancy change since Q3 2021 in the Miami Airport submarket.
- The Miami Airport submarket had the lowest vacancy level since Q3 2017.
- Vacancy is expected to finish 2022 at 4.5% in the Miami Airport submarket.
Submarket Overview
With 25.9 million square feet, amounting to 20.9% of the total metro inventory, the Miami Airport submarket is the largest of the seven distinct geographic concentrations that form the Miami warehouse/distribution market. In the nine-year period beginning with Q1 2012, new additions to the submarket totaled 3.3 million square feet, amounting to an annualized inventory growth rate of 1.4%; over the same period, the metro growth rate has been 1.7%.
Asking and Effective Rent
Asking rents climbed by 1.8% during the fourth quarter of 2021 to an average of $9.03, a level surpassed only by the South Central submarket’s $10.18. The submarket has now experienced four consecutive quarterly gains in asking rent, for a cumulative total of 5.2%. The Miami Airport submarket’s current asking rent levels and growth rates compare favorably to the metro’s averages of $8.14 and 1.4%. Effective rents, which exclude the value of concessions offered to prospective tenants, advanced by 1.9% during the fourth quarter to an average of $8.68.
Competitive Inventory, Employment, Absorption
Total employment in the Miami metropolitan area grew by 19,300 jobs during the fourth quarter, while industrial employment expanded by 1,700. Since the beginning of Q1 2012, the average growth rate for industrial-using employment in Miami has been 0.5% per year, representing the average annual addition of 700 jobs. Over the same time period, the metro recorded an average annual absorption rate of 2.5 million square feet. During the fourth quarter, the metro experienced absorption of 1.9 million square feet, but absorption was flat in the Miami Airport submarket. The fourth quarter’s unchanged occupancy total in the submarket follows 643,000 square feet of positive absorption observed in Q3 2021. Over the last four quarters, submarket absorption totaled 1.2 million square feet, nearly triple the average annual absorption rate of 397,800 square feet recorded since the beginning of Q1 2012. The submarket’s average vacancy rate held steady at 4.8% during the fourth quarter, which is 1.4 percentage points lower than the long-term average, but 1.5 percentage points higher than the current metro average.
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