Broward County’s office market is benefiting from improved employment and a lack of new construction, a new report from CBRE shows.
The county’s vacancy rate had a year-over-year decline of 2.3 percent to 15.7 percent during the second quarter of 2014. Broward’s Class A sector led the way, with a 4.1 percent year-over-year vacancy rate drop to 13.8 percent. The Class B sector had a 0.5 percent decrease to 16.2 percent, while Class C office buildings experienced a 1 percent year-over-year drop to 20.7 percent.
Asking rental rates stayed relatively flat at $16.60 per square foot triple net (leases in which the tenant covers some or all of property tax, maintenance and insurance costs). Class B and C property owners continue to dangle rent concessions to attract new tenants.
No new office buildings were completed during the second quarter. Only two small speculative buildings totaling 75,000 square feet are under construction in Broward. CBRE cites rising development costs from the flurry of multifamily and retail projects in the county as the key reason office builders are staying on the sidelines. — Eric Kalis