In the course of a year, office rentals increased while vacancies decreased in each of the three counties of South Florida.
Miami-Dade County’s average asking rent for offices in the fourth quarter of 2022 was $50.06, an increase of 10.02 percent from the previous year. Class A office buildings at the top of the market saw an average rent rise of 12% to $57.18. Office vacancies in Miami-Dade were 10.1% in Q4 2022 compared to 10.7% in Q4 2021.
In Palm Beach County, the median asking rent increased by 9.26% to $40.70 per square foot in Q4 2022. Rents in the Class A office segment increased 7.06% to an average of $46.43 per square foot. In all of South Florida, Palm Beach has the highest vacancy rate for office space at 8.3%. It was also considerably lower than the county’s vacancy rate of 9.7% in the same quarter last year.
Although not as much as the 5% inflation rate that the New York Federal Reserve predicted for the next year, asking rents increased in Broward County. Rents in Broward increased by 4.93% year over year to an average of $37.22 in the fourth quarter of 2022. The average asking rent in the Class A segment increased by 3.33% to $41.64 per square foot.
Since the outbreak, office rents have been slowly increasing as companies and businesses from outside the area—some of them newcomers—look for space in South Florida. These businesses frequently keep tabs on professionals moving to the tricounty area as well as potential high-end customers.
Some businesses are even transferring their headquarters to South Florida, though this is not as prevalent.