Top 5 Florida Markets for Industrial Development
- Dec 08, 2020
Despite most commercial asset classes facing strong headwinds, industrial demand is as high as it’s ever been. With this year’s shift toward online shopping, e-commerce giants like Amazon continue to grow, while many brick-and-mortar retailers are investing more and more into supplementing physical footprints with an online presence. Florida’s industrial markets have benefited not only from this shift but also from relatively steady sea cargo volume, even as the United Nations Conference on Trade and Development projects a 4.1 percent global decline this year.
Florida’s industrial developers have taken note: CommercialEdge shows nearly 14.9 million square feet underway, or roughly 2.3 percent of completed inventory, with close to one-third slated for delivery by year-end. That’s on top of the 17.6 million square feet already delivered through mid-November. Last year’s completions, by comparison, totaled 16.6 million square feet.
The table below uses CommercialEdge data to highlight the five Florida markets with the highest levels of industrial development.
Jacksonville’s industrial market has long been a strong performer, bolstered by its major shipping port and further augmented this year by the rapid growth of e-commerce. Although only a handful of major projects are underway, industrial completions this year have hit a record high. Through mid-November, 2.9 million square feet delivered, the highest level since 2009.
The largest project underway was VanTrust Real Estate’s 1.1 million-square-foot Building E at Imeson Park. Located at 10501 Cold Storage Road in the North Jacksonville industrial corridor, the asset is fully leased to Amazon with delivery slated for late 2021.
4. Fort Lauderdale
Development has picked up in Broward County this year, with industrial deliveries topping 1.5 million square feet and 11 projects underway totaling an additional 1.7 million square feet. Even though passenger cruises have completely halted at the county’s Port Everglades, the facility remains one of the U.S.’s busiest shipping ports, with a volume of more than 1 million TEUs (20-foot equivalent units) per year.
Bridge Point 595 was the largest industrial development underway. Bridge Development Partners broke ground on the three-building, 677,310-square-foot park in October 2019, with delivery expected in the first quarter of 2021. The structures will have 32-foot clear heights, ESFR sprinkler systems and a combined 132 dock-high loading doors. Wells Fargo provided the developer with $60.3 million in construction financing.
Although Orlando’s economy has taken a substantial hit this year, the industrial sector has come back to life. Area employers added 11,500 trade and transportation jobs between April and September, according to the Bureau of Labor Statistics, reflected by growing demand for modern distribution space. Developers are moving forward with projects totaling 2.6 million, more than 80 percent of which is speculative.
Building 800 at Infinity Park is the largest property underway. McCraney Property Co. and Tavistock Development Co. broke ground on the 433,404-square-foot speculative project in August at 2500 Consulate Drive, with completion set for early 2021. The building is one of four within the 206-acre park’s second phase.
2. Tampa Bay
Florida’s largest industrial market continued to expand, with 3.8 million square feet underway across 16 projects. Deliveries through mid-November totaled 6.1 million square feet and may finish the year beyond the 2016 peak of 6.3 million square feet. In addition to a diversified port, shifts from retailers toward e-commerce operations have driven much of the market’s activity, with Ace Hardware and The Home Depot moving forward with distribution centers.
Brennan Investment Group’s 1 million-square-foot Building 400 at CenterState Logistics Park East in Lakeland broke ground in August, becoming the market’s largest development underway. Upon completion, the cross-dock spec facility will have 40-foot clear heights, 238 loading doors, 190-foot truck courts and 70-foot speed bays. Citizens Financial Group provided $42.6 million in financing.
Topping our list, Miami has some 4.2 million square feet underway, equal to 3.3 percent of inventory. The metro’s role as a major international trade hub remains intact even amidst the backdrop of economic uncertainty: In the 2020 fiscal year, PortMiami reported only a slight decrease in sea cargo volume from the previous year to 1.1 million TEUs. In addition to port traffic, e-commerce growth is also pushing industrial demand higher, particularly for well-located, last-mile distribution centers.
Nearly 90 percent of the metro’s industrial development activity was concentrated in Hialeah, northwest of Miami. The largest project underway is a two-building, 1 million-square-foot build-to-suit facility for The Home Depot. Florida East Coast Industries began construction in January with an anticipated delivery this winter.