ORLANDO—The U.S. Bureau of Labor Statistics recently reported that Orlando had the nation's fastest-growing economy for job growth in 2015 over a trailing 12-month period. That's the first thing Greg Morrison, principal and managing director of Avison Young's Orlando office, tells you when you ask about the state of Orlando.

“Orlando was also ranked seventh on Forbes magazine's list of America's Fastest-Growing Cities of 2016,” Morrison tells GlobeSt.com. “These statistics are reflected in three major employers opening sizable regional locations in Orlando's suburban markets over the last few years and bringing with them new jobs.”

Market fundamentals in Orlando are steadily improving. Vacancy was down 190 bps year-over-year to 13%, and net absorption of office space was relatively strong during the 12 month ending at mi-year 2016 with 1.1 million square feet absorbed, according to Avison Young's latest office report. That total is up 200,000 square feet from the previous 12-month period.

Meanwhile, rental rates keep trending upward in key submarkets. Stringent financing requirements are limiting new speculative development.

Morrison noted how ADP recently signed a lease for 256,892 square feet of office space for its regional headquarters in the Maitland Preserve office complex. Last year, Deloitte Consulting leased 212,000 in Lake Mary. And in 2014, wireless carrier Verizon took occupancy of a 220,000-square-foot built-to-suit office building in Lake Mary. That, Morrison said, is a pretty impressive roster of landing large new employers.

“The growing desire from corporations to have a regional office in Orlando is due to its attractiveness as a place to live with a population that continues to grow—and, in particular, its educated workforce due to its proximity to surrounding universities,” Morrison says. “As a result, the demand is starting to outpace the supply of available large blocks of contiguous space. With little new construction in the pipeline, this scenario is creating a further tightening of the market that will push rental rates higher at a faster rate than typical, all things being equal.”

Lake Mary is seeing Orlando investor spillover. Check it out.

Meanwhile, rental rates keep trending upward in key submarkets. Stringent financing requirements are limiting new speculative development.

Lake Mary is seeing Orlando investor spillover. Check it out.

Instant Insights /

Orlando Seeing Perfect Storm for Office Landlords

Related Stories

Recommended For You