Miami-Dade's Tourists Love to Shop
Visitors, new residents help boost the tightest market in Florida, the most active pipeline in the nation.
Tourists love to shop and there are few markets where retailers are stronger than in Miami.
The city is experiencing record levels of domestic tourism and an influx of new residents. Its markets have flexed their retail demand muscles with six consecutive quarters of positive net absorption, according to Marcus & Millichap’s Q2 report.
Leasing activity is robust in South Dade, Miami (City) and Kendall, submarkets receiving much of the metro’s incoming population.
“Retailers have also shown a willingness to pay a premium to set up shop in affluent, urban areas in the metro like Coconut Grove, Brickell and Miami Beach, where asking rents have surged above $60 per square foot in the past year,” according to the report.
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JLL managing director Zach Winkler tells GlobeSt.com that he continues to see the Miami market remain strong in the retail sector.
“While the larger trends of the growing population and relocation of major office tenants has been happening for a number of years, we have seen a definite acceleration of this over the past year or two creating a surge in [retail] demand,” Winkler said.
“Additionally, tourism in Miami has been immensely strong, with the notion of seasonality becoming less and less of a factor thanks to events such as Formula 1 taking place during non-winter months only helping that cause.
“Lastly, many retailers cite the business-friendly climate in Florida, and that they feel their investments are more secure here for the long term.”
Senior managing director Danny Finkle, co-head of US retail capital markets and the JLL capital markets’ Miami office, tells GlobeSt.com that South Florida retailers and restaurants have been notable benefactors of the amazing population and employment growth across the region.
“De minimis amounts of new retail supply with continued retail and restaurant expansion plans in the market is putting upward pressure on rents,” Finkle said. “Interestingly, with occupancy levels north of 96%, rents are poised to continue to grow for the foreseeable future.”
The World Travel & Tourism Council estimates foreign traveler spending in the US will surpass last year’s amount by $113 billion in 2022. Therefore, demand for retail space in Miami may accelerate as restrictions on international travel are eased.