South Florida’s industrial real estate market’s second quarter proved to be its strongest period in three years, according to a recently released report from Newmark Knight Frank.
Industrial developer Jose Hernandez-Solaun of The Easton Group has seen Amazon spur the rise of e-commerce over the last few years. But now, he sees the coronavirus pandemic rapidly ramping up that growth — putting it on steroids.
“What we are finding now is the coronavirus effect,” said Hernandez-Solaun. “If the Amazon effect was strength training, this was what you get on performance-enhancing drugs.”
Hernandez-Solaun and other South Florida industrial brokers and developers say the sector could benefit in the long-term from many of the behavioral changes spurred by the crisis. Consumers, increasingly from older generations, will shift more of their spending to e-commerce. More manufacturers will come to the Americas from China. And after experiencing inventory shortages, more warehouses will be needed, experts say.
Warehouses in South Florida sold for less this year than in 2018, according to a recent study. But the price per square foot in Miami-Dade was up, indicating a healthy market, say experts.
The average sale price for industrial spaces in Miami-Dade, Broward and Palm Beach dipped from $1.9 million in 2018 to $1.6 million in 2019, according to Reonomy. The commercial real estate data company studied nine metro areas from 2014 to 2019 in its “State of the Industrial Real Estate Market: MSAs on the Rise” study published in November.