Tenants across various sectors, such as e-commerce, importers, and beverage companies, are facing significant challenges in securing storage spaces for rent in Miami-Dade, as indicated by the all-time low vacancy rate of 1.6%, reported in the JLL fourth quarter 2023 Miami Industrial report released in January.
The driving force behind this surge in demand is rather straightforward: the region’s burgeoning population growth and thriving tourism industry.
The state of Florida witnessed one of the highest population growth rates in the nation during the COVID-19 pandemic. Despite Miami-Dade experiencing a net loss of residents in recent years, the influx of newcomers, coupled with the increasing reliance on online shopping, has intensified the need for warehouse facilities near densely populated areas within the most populous county in South Florida, facilitating swift product delivery.
Furthermore, the tourism sector has significantly contributed to the soaring demand for warehouse space. In the previous year, tourist arrivals in Miami-Dade County during the first half of the year reached 12.4 million visitors, according to data from the Greater Miami Convention and Visitors Bureau. With expansions underway at Miami International Airport, including additional flights and the development of a new luxury wing, along with the thriving activities at PortMiami, companies are compelled to expand their warehouse capacities to accommodate the escalating demand for inventory storage related to the hospitality industry.
Companies are actively seeking additional warehouse space, with JLL tracking 115 tenants in South Florida in search of 7.4 million square feet of storage space. Encouragingly, another 8.2 million square feet are currently under construction, with most projects expected to be completed within the year.
Investors are increasingly drawn to South Florida’s real estate market, recognizing the high demand and consistent rental income as secure investments. Notably, the Mormon Church’s acquisition of an industrial park in Hialeah for $174 million last year marked the largest warehouse sale in Miami-Dade, underscoring the region’s appeal to real estate investors.
