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Office, retail markets on road to recovery

After tough stretch, big-box retailers make a comeback in Miami

While Miami’s residential market has experienced fast-paced growth during the past two years, the local office and retail market have had a slower go of it. The former saw a massive infusion of new space, thanks to the introduction of towers like 1450 Brickell, Brickell World Plaza and the Wells Fargo Financial Center, while the latter, particularly susceptible to the economy, was hard hit by the national retail recession.

But signs of strength are emerging, with a number of large-scale office and retail leases signed this year throughout South Florida, according to data provided to The Real Deal by Costar.

The largest office deal was a 198,583-square-foot lease by Norwegian Cruise Lines’ lease at Airport Corporate Center, handled by Hines. The second-largest lease was the Miami Herald’s Doral Operations Center space for 158,266 square feet in a deal handled by Jones Lang LaSalle and Blanca Commercial Real Estate.

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According to an October report from Jones Lang LaSalle, the office vacancy rate in Miami’s Central Business District was approximately 20.4 percent at the end of September.

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It should be noted that half of the largest leases were renewals by existing tenants, not new-to-market deals.

On the retail side, the big story was the return of big-box stores, led by Burlington Coat Factory, which signed an 81,769-square-foot deal at Miami’s Airpark Plaza in a deal handled by the Rotella Group.

The second-largest retail lease was that of Lord & Taylor at Mizner Park (handled by GGP on the landlord’s side), taking a former space of Robb & Stucky, which departed the park after its bankruptcy in 2011.

Fourth on the list was also a big-box retailer: Walmart took 45,500 square feet at Boynton Trail Centre in Boynton Beach, a deal handled on the landlord side by Cohen Commercial Realty.

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