Assessing The Commercial Real Estate Market In Broward County
The industrial and commercial real estate scene in South Florida has been positively impacted by global markets in a lot of ways. This area has benefited from it's major role as being the "Gateway to the Americas," and port traffic is also increasing from Asian countries.
Analysts think that this relationship with Latin European and Asian markets will help in the revitalization of the region's slumping residential markets, and make the commercial property markets fully rebound as well.
Higher Land Prices And Development Costs Are Putting Some Pressure on The Commercial Markets
Current high land prices, coupled with development costs, have helped lessened the building of new industrial inventory, and some real estate professionals forecast construction increasing, as the slump in the residential market may ase material costs in the long term. But, as economic growth in the Asian and the Indian subcontinent may keep the prices for steel, concrete and other building supplies high, this could in turn limit how much speculative space is brought on to the market. Broward County's commercial and industrial real estate market has remained well below the national average vacancy of approximately 10%.
Some Commercial Property Developers Are Adopting A Wait-And-See Attitude
Many have surmised that some commercial real estate owners and developers appear to be holding on to their investments, as solid returns slowly start coming in during current market conditions. Low vacancy rates, coupled with the lowering currency, make South Florida's commercial and industrial real estate market a prime investment opportunity. Property owners and developers in this area may may take advantage of conditions once the market shifts more to a tenant's market, and the vacancy opportunity increases as well.
How The Future Looks For The Area's Commercial Property Market
Real estate professionals in this county continue to remain bullish on the industrial and commercial real estate sector, while others are noting that signs of a downturn are beginning to surface; however, there are many factors and conditions that may have an impact on the market during the next economic shift.
The scarcity of industrial-zoned land to develop speculative inventory may continue to help low vacancies and demand higher rental rates, however if the residential sector continues to slide, developers could adopt a wait-and-see attitude and cancel or restructure their future plans.
Broward County however, is viewed to be a durable market during the next dip in the economic cycle. It is expected that commercial real estate vacancies will rise in this area, sublease space will come on the market and asking rates will eventually stabilize and go down; however, disciplined development coupled with South Florida's strong ties to the global market and the import/export sector will continue to help the area's commercial property markets weather the mortgage slump.
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