Investment sales activity roared back this year across South Florida commercial property types, aside from one: multifamily.
As a whole, deal volume totaled $4.3 billion in the first quarter, a 29.9 percent increase from the same period last year, according to an Avison Young report. A total of 244 sales closed, or 10.9 percent more from the first quarter of last year.
Two asset classes drove the surge this year. Industrial recorded the highest deal volume nearing $1.3 billion, marking a 102.4 percent increase from the first quarter of last year. A total of 79 sales closed.
Blackstone’s Link Logistics has been an industrial heavyweight. It paid $195.9 million for an eight-building warehouse portfolio in Boynton Beach last month. That came after it paid $163.1 million for a four-warehouse complex in Broward County.
Beyond Blackstone’s hefty investment, for years South Florida’s industrial market has been propped up due to the land constraints of the region that make it devoid of developable land large enough for warehouses.
A total of 22 sales of development sites penciled out to $503.9 million in deal volume, marking a nearly 123 percent jump in volume from last year, the report shows.
While a record $520 million development site sale for a 4.25-acre bayfront Brickell lot closed in December, the first quarter also netted some top sales. In March, Japanese firm Kasumigaseki Capital bought a 1.4-acre development site at the Miami Worldcenter mixed-use complex in downtown Miami/Park West for $88.8 million. In another notable sale in the first quarter, Ultimate Equity, led by David Sedaghati, sold a nearly 2-acre Wynwood assemblage entitled for a Live Local Act project for $54 million.
Retail deal volume reached $642 million, a nearly 65 percent increase, year-over-year, according to the Avison Young report.
Some of the retail trades have focused on Miami Beach’s Lincoln Road promenade, once a premier shopping and dining stretch that’s lost some of its allure in more recent years partly due to the rise of new retail hubs such as Wynwood and Miami Design District. More recently, a group of brokers and investors are banking on a return of Lincoln Road.
Shahab Karmely’s New York-based KAR Properties bought an AllSaints-leased Lincoln Road building last month for $15 million.
Office trades hit nearly $885 million, or a 2.7 percent jump from the first quarter of last year, according to the report.
In the pandemic-era, South Florida earned a reputation for a thriving office market due to an influx of out-of-state companies. More recently, the hype has been revived, this time due to the blue-to-red state in-migration by wealthy individuals who are expected to open private or corporate offices in South Florida. Yet, these tenants aren’t necessarily going for some of the legacy towers in Brickell and downtown Miami but rather are more likely to take space at some of the boutique buildings on tap or recently completed.
Some of the deals that played a role in the modest uptick in office sales this year include Moishe Mana’s $110 million purchase of the 31-story One Downtown tower in downtown Miami.
The multifamily market’s drop in deals comes after apartments were the darling asset class in South Florida for the past five years. After the pandemic’s onset, the region experienced unprecedented rental demand, prompting record rates and a slew of investment sales.
This tide turned in more recent years due to several new unit completions just as the influx of newcomers slowed. A record 18,600 units were finished in 2024, or 20 percent more than total leasing for that year, according to CoStar Group data.
Last year’s completions totaled 12,718, slightly more than the 12,452 total leasing, CoStar data shows.
Yet, developers have been starting new apartment projects this year, arguing that they’re carefully picking the submarkets where they want to build and that demand will return once they finish their projects.
In some of the top multifamily sales this year, RPM Living and Cantor Fitzgerald picked up the 380-unit Biscayne Shores complex, which includes rental townhomes, for $151.4 million.
Also, New York-based Maxx Properties paid $70 million for the 250-unit Ellery complex in Plantation.
Avison broker Michael Fay said multifamily, as well as office, activity is “moderating,” adding that it’s a “natural progression.”