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MIAMI-A dramatic rise in sublease space and speculative construction completions have pushed overall vacancy rates in Miami’s office market to 16%, up 4.6% over the last 12 months, according to a third quarter office market report from Cushman & Wakefield of Florida Inc.

The central business district vacancy level is at 14% as average rents dip to about $23 per sf. Outside the CBD, rents are in the $22 per-sf range.

Only 39% of the 1.1 million sf of the space completed since the beginning of the year is occupied. Another 1.9 million sf is under construction, most of which is expected to be completed in the next 12 to 18 months. Sublease space has risen more than 50%, to 675,000 sf.

“Hopefully, we have hit the bottom of the market,” Cushman & Wakefield Senior Marketing Director Pete Harrison, tells GlobeSt.com. “But I think we will be there for awhile. Corporate America will continue sitting on the sidelines until the end of first quarter next year. We hope for renewed activity in the second half of next year.”

Harrison says the current market can be compared to 1991 in many respects, except it’s not as bad. In 1991, he noted, vacancy rates were at the 25% to 30% level.

Harrison says the Downtown, Brickell and Coral Gables submarkets are in relatively good shape and should rebound next year. But the West Airport submarket, which has a lot of product available, could take two years to get its feet back on the ground. He noted that 40% of the sublease space is in the West Airport submarket.

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