Vacancy rates are beneath the 10% threshold and rents are rising at a robust pace. The vacancy rate was forecast to end the year at 8.5% and asking and effective rents are projected to climb 8.7% to $28.88 per sf and $24.84 per sf respectively in 2007. During the year, the median price of office properties climbed 10% to $243 per sf, according to a Marcus & Millichap Real Estate Investment Services report.

DTZ Rockwood Miami office managing director John Bell is equally bullish on the Miami office market. "Despite the housing market headlines, South Florida continues to grow at roughly double the national pace and is forecast to do so in the foreseeable future," Bell says. "While a slight housing-induced dip in growth is forecast in 2008, job growth is expected to accelerate over the next five years."

Miami continues to lead Fort Lauderdale in low office vacancy rates. In addition, given the five-year forecast of 50,000 new office jobs, 12 million sf of demand will need to be met. The state of the residential housing market and an abundance of options near urban job hubs may support growth in key office submarkets, Bell says.

Bell also notes that, although residential condominium construction is challenging the region's housing market, it has not yet impacted commercial market fundamentals.