The Real Deal Miami

SoFla’s office, multifamily sales fall in Q2, year-over-year: report

Yet in Palm Beach County, multifamily sales skyrocketed 257% and the tri-county area's retail and industrial markets remain solid
By Keith Larsen | September 04, 2018 02:35PM

Sabadell Financial Center

Some of South Florida’s best performing real estate sectors now appear to be showing signs of a cool down — with the exception of Palm Beach County’s multifamily market and the tri-county region’s retail and industrial asset sales.

A new report from the data firm Vizzda and the Miami Association of Realtors shows that the volume of office and multifamily sales fell in South Florida in the second quarter of 2018 on a year-over-year basis.

The data could suggest that South Florida is nearing the end of a cycle and after years of high demand, prices are starting to come down.

South Florida’s once booming office market declined 8.7 percent in total sales volume on a yearly basis to $799.4 million in the second quarter. Sales volume declined despite the Sabadell Financial Center selling for $249 million in June, marking one of Miami’s largest office sales.

Of the three counties, Palm Beach County reported the biggest decline in sales volume, falling 14.4 percent to $132.6 million.

The volume of multifamily sales also fell, overall, in the tri-county area. Total sales volume declined 22 percent in South Florida to $999.7 million in the second quarter of 2018 as compared to the second quarter of 2017.

Multifamily was until recently one of South Florida’s best performing asset classes due to a housing shortage in the area and a lack of affordable homes.

Broward County and Miami-Dade County saw multifamily sales dip, but Palm Beach County’s multifamily market skyrocketed by 257 percent to $617 million, especially in Delray Beach and Boynton Beach. There, more than 1,000 units traded hands through six transactions totaling more than $207.8 million in sales. Palm Beach County also registered the highest per unit valuation of the last five quarters.

The report’s numbers suggest that retail has continued to remain strong in South Florida, despite struggling nationally. Sales volume for retail increased 3 percent to $748.7 million in total sales volume in the second quarter of 2018. 

The industrial market also continues to remain a strong performer South Florida. In Broward County, industrial sales nearly doubled in the second quarter from the previous year to $240.3 million.