Broward county, typically known for its beaches and shopping, is making a new name for itself as a business hub as more and more companies are entering the Downtown Fort Lauderdale market. According to JLL’s Q3 2016 Office Insight, Fort Lauderdale’s Class A assets are thriving in a tight market. Direct vacancy in Broward has declined 80 basis points quarter over quarter to 11.9%, making the third quarter the strongest for vacancy declines over the past 24 months. The growth of Fort Lauderdale’s office market is creating high demand for executive suites in the area.
Here are a few of the factors that are driving this growth in Broward County:
Looking for Change
A key difference between the Miami and Fort Lauderdale market is rent. Direct asking rents in Fort Lauderdale average $28.89 per square foot while Miami’s is currently at $36.90 per square foot. At the same time, workforce and employee quality of life also vary drastically between the two markets. Fort Lauderdale has less congestion and traffic detours, making commuting more convenient for employees. Fort Lauderdale’s open landscape also makes it easier for travel between the port, airport and Miami – Dade and Broward counties.
Demand Trumps Supply
A few sites in Downtown Fort Lauderdale are great opportunities for office development, but construction is either slow to come or multi-family developers have bought up the sites. Furthermore, the vacancy rate among Downtown Class A assets is at 4%—any additional office space would have little impact on the currently healthy market.
The Rise of Co-working Spaces
Millennials are attracted to co-working spaces making executive suites a good fit for startup companies and entrepreneurs. In Downtown Fort Lauderdale especially, executive suites are seeing high occupancy rates. This shift in work environment has led to the opening of another co-working space in Fat Village—a neighborhood not traditionally associated with office space.
Most recently, Pipeline Workspaces opened a 13,100-square-foot space in One Financial Plaza, making them the newest operator to lease space in the market. For new providers looking to enter Broward, there are few options available as large blocks in the market continue to fill up.
For those looking to secure favorable leasing terms in Fort Lauderdale, timing is key. Start the process early and have a second or third option to fall back on. It’s also a good idea to consider other submarkets in Broward for a better rate. Fortunately for renters, not all of Broward is a landlord’s market. Specifically, in Cypress Creek and Northwest Broward, vacancies are decreasing but rates are still considerably low.