Office Markets in South Florida Are Booming While New York Struggles
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Loading... - albert charlotte
- 07 Mar 2023
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Lower taxes, year-round sunshine drawing businesses and more permanent residents
The snowbirds are coming to Florida, fleeing the freezing climate of the north as they do every winter, but this time they're coming to stay and in the process transforming the skylines and lifestyles of the state.
Florida's population grew almost 2% in 2022, making it the fastest-growing state in the nation for the first time since 1957, according to U.S. Census data, as families and businesses are drawn by lower taxes and growing numbers of jobs. That's contributing to an office building boom in a state once better known for retirement communities and hotels.
While markets like New York and Chicago grapple with a surplus of older office space deserted by tenants willing to pay high rates in newer, Class A buildings, commercial markets like Miami and Palm Beach are seeing new construction rates soar as demand grows.
The commercial "market is performing totally differently than it has historically,'' said Marc Miller, head of Florida research at global real estate firm CBRE. "When you start looking at Class A and what we would consider trophy assets, the real top of the market, we're seeing growth at 30% year over year, and that's being fueled almost exclusively by the new-to-market demand because these companies that are coming down are coming from higher cost markets.''
Migration Driving Growth
Florida was the top state for migration from within the U.S. in 2022, contributing to its population growth.
The state has no personal income tax and year-round sunshine, which served as a draw for some of the nation’s wealthiest looking to escape cities during and after the pandemic, according to Gillian Lieberman, a broker at William Raveis Real Estate, a luxury agency based in South Florida. Read More…
