South Florida Commercial Real Estate: How Will Miami Commercial Property Fare in 2013?

by Rosa Eckstein Schechter
Contact

Entering into the New Year, Florida real estate analysts and professionals involved in land development and real estate investment are looking at the South Florida commercial real estate market and wondering how it will fare in the upcoming twelve months. All things considered, the future of South Florida Commercial Real Estate looks good as the following factors come into play:

Lack of New Construction Means Tenants Have Leverage in Negotiations

Last week, the Sun Sentinel reported on the state of the South Florida commercial real estate market, concluding that Miami area commercial properties will find a continuing recovery in 2013 but without expectations of any sudden upswings. In an article written by Paul Owers entitled"Commercial real estate market 'bouncing along bottom'," the gist of those experts queried for their opinions seems to be that it's a tenants market right now in South Florida, due in no small part to the lack of new construction of office buildings, warehouses, retail spaces, and the like over the past few years. For businesses looking to lease office or retail or warehouse space, there are deals to be made right now in South Florida.

CMBS Loans Delinquency Rates Falling for South Florida

Meanwhile, for the first time in several years, the delinquency for commercial mortgage-backed securities ("CMBS") loans secured by South Florida commercial properties is under $1 billion dollars ($957 million) and December 2012 saw the delinquency rate at a low 8.2% (compared to the prior year's 9.4%).

According to a South Florida Business Journal report, this translates into South Florida commercial mortgage-backed securities loan delinquencies going in the right direction (down) while the United States as a whole has seen the CMBS delinquency rate stay about the same (9.7% in December 2012, 9.6% in December 2011).

Experts report that CMBS loans in the Miami area are performing well these days because the South Florida real estate market is finding favor with investors and things are happening here.

Major New Commercial Projects Planned for Miami and South Florida

The expansion and re-do of the Miami Beach Convention Center should be finalized and moving forward in 2013; the Convention Center's master plan should be ready to roll by May 2013 according to city planners. This will involve not only the convention center meeting spaces but a convention hotel site as well as the expected commercial properties to compliment these new facilities. It's a major overhaul of the Center which some estimate will take up to $1 billion to complete.

While this isn't the only new, big commercial project being planned for Miami, it is a big deal in considering the future of Florida's real estate market given this overhaul is happening now and the last time the Convention Center had any work done was in the late 1980s.

Perhaps the biggest news in South Florida's future is the international investment and trade influx to our area. As discussed in prior posts, Port Miami is currently being expanded to accommodate the huge sea vessels that will soon be able to move through the renovated Panama Canal. This will not only increase Miami's stature as an international trade center,but it will bring with it the need for extended commercial real estate planning and projects to meet the needs of this increased sea trade traffic.

Miami - Dade County Is First US Foreign Trade Zone Operating Under Alternative Process

Additionally, the Commerce Department of Commerce not only allows Miami-Dade County to operate as a Foreign Trade Zone (Miami is FTZ No. 281) but Miami-Dade is the first FTZ in the country that has been approved to operate under the federal government's new "Alternative Site Framework" which is designed to "streamline" things.

This is very important to the future of South Florida's commercial real estate industry because a foreign trade zone is created in order to help foreign commerce by allowing the FTZ to be exempt from the usual requirements of U.S Customs. How? FTZs are not considered U.S. Customs territory insofar as the payment of duty, and any company that does business in an FTZ can reduce or even erase the usual custom duty payment.

Here is the map of the Miami Dade FTZ, which extends north from SW 8th to the Broward County Line:

 

Written by:

Rosa Eckstein Schechter
Contact
more
less

Eckstein Schechter Law on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.