Orlando Office Market is on FIRE as Recovery Continues

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ORLANDO—With large financial services firms stabilizing and smaller firms in the Financial Insurance and Real Estate sector eager to grow, Orlando’s Central Business District—and even suburbs—are seeing plenty of office leasing action. The third quarter saw four significant FIRE lease deals.

Global insurer Zurich renewed a lease for 27,913 square feet at Maitland Promenade II in the Maitland Center submarket. Mortgage Masters, a Massachusetts-based and privately-owned direct mortgage lender, expanded into Florida with a 4,676-square-foot lease at Maitland Green II, also in the Maitland Center submarket. And PNC Bank expanded its office lease Capital Plaza One in Downtown Orlando by 8,674 square feet, bringing its total footprint to nearly 20,000 square feet.

“We have four quarters of CBD absorption and we’re finding traditional FIRE is heating up,” Yvonne Baker, a vice president and director of agency leasing at Jones Lang LaSalle, tells GlobeSt.com. At the end of the third quarter, Hannover Life Re took down 40,000 square feet in the SunTrust Center. It was one of Downtown Orlando’s largest remaining blocks of space. Hannover is expanding and relocating from One Orlando Centre.

“The SunRail station into the CBD is making a difference,” Baker says. “Hannover told us one of the reasons they are relocating to SunTrust Center so employees could get off at the SunRail station right by the office.” The SunRail is a commuter rail transit project that will run along a 61-mile stretch of existing rail freight tracks in Orange, Seminole, Volusia, and Osceola counties.

The Orlando CBD’s 16.6% vacancy rate is outpacing the suburban market average of 20.8%, with year-to-date net positive absorption in the CBD at 114,372 square feet while the suburbs have seen net negative absorption, according to JLL’s third quarter Orlando office market report. Rental rates reflect these trends, with average CBD class A rates at $24.64 and suburban class A rates at $21.12.