Market Reports

The Orlando office market saw improved office activity in the second quarter after a somewhat slow start to the year. Quarter-over-quarter, the average deal size rose by 11.2 percent with Downtown, South Orlando and East Orlando as the three submarkets benefitting from an increase in office leasing activity. The majority of institutional landlords in downtown Orlando are some of the early adopters of flight-to-quality phenomenon, and as a result, tenants from other submarkets have shifted their focus to the city’s Central Business District (CBD).  On the other hand, South Orlando enjoys a built-in advantage of having perhaps the greatest number of restaurant options in the greater Orlando area, with easy access to both Sand Lake Road and Millenia Mall areas offering various food options. The need to be co-located with some of the military branches located in Central Florida Research Park drives many simulation and military/defense sector tenants to seek office space in East Orlando, also providing nearby access to the University of Central Florida. Aside from geographical location, more and more tenants are seeking out higher-quality office space while rightsizing their footprint. This is predominantly fueled by flex/remote office schedules combined with the need for employers to provide an …

A wave of new-to-market office tenants — specifically legal tenants following the influx of financial firms and tech companies — continue to expand their presence in Miami. The trend further solidifies the city’s spot as a top destination for companies seeking reduced taxes, strong talent and vibrant communities. Looking back at the first quarter of 2023, net absorption totaled over 81,000 square feet (compared to 76,000 square feet in the first quarter of 2022), marking the third-highest quarterly total since 2020. Most leasing activity occurred in the Central Business District (CBD) and in Class A product in Wynwood and Coral Gables as tenants continue to lease high-quality space.  However, the lack of availability in quality product, as well as the overall economic uncertainty, has led to a slowdown in leasing volume to start 2023 — particularly among new-to-market tenants. Leasing activity totaled 750,000 square feet in the first quarter compared to 1.5 million in fourth-quarter 2022. The quarter closed with a 16.3 percent vacancy rate, the lowest level since the onset of the pandemic in early 2020. Class A availability fell 260 basis points to 21.1 percent year-over-year with the largest drops recorded in downtown Miami, which fell 540 basis …

Once bypassed by national developers and investors for larger, metropolitan cities like Miami, the real estate community is now realizing what locals have known for years: Tampa is trending. Tampa Bay’s recognition as one of the country’s top places to live has trickled into the region’s office market, which as of the first quarter of the year, has continued to reap the benefits.  While some credit the Tom Brady effect to Tampa’s rise into the national spotlight, the Tampa Bay region is seeing growing demand in other economic sectors beyond sports, including housing, business and leisure. In fact, Time Magazine just featured Tampa as one of only four U.S. cities in its highly coveted 2023 list of the “World’s Greatest Places.” Flurry of activity to start 2023 For the first time in five quarters, the Tampa Bay office market recorded positive absorption of more than 55,000 square feet thanks to more companies moving into space rather than vacating it, JLL’s first-quarter Office Insight Report for 2023 shows.  This can be largely attributed to Reliaquest’s move into its 140,000-square-foot headquarters located at Thousand & One Water Street, where it is currently occupying 120,000 square feet, and which made up the lion’s …

The Orlando office market is finally seeing positive absorption across all major submarkets. An impressive second quarter recorded 122,423 square feet of positive absorption, bringing the total for the first half of the year to 156,778 square feet. As companies have been making decisions on their return to the office, the Orlando market has seen increased activity with numerous large, long-term leases signed, predominantly fueled by smaller local users and corporate relocations from other markets. Kimley-Horn’s relocation and expansion to 60,000 square feet in downtown Orlando marked one of the largest transactions in the past five years. While still up 20 basis points year-over-year, total vacancy saw its first drop in the last four quarters. Vacancy was consistently holding at 13.3 percent from third-quarter 2021 until it fell 30 basis points this quarter to 13 percent. The major driver of the drop was vacant sublease space being withdrawn or leased. Although firms are still seeking sublease route for their office space, we believe more space will be given back in the near term. We are seeing an increased pattern of flight to quality, where corporate users are focusing their attention on submarkets and assets that provide higher quality workplaces and …