The office market, particularly the higher quality Class A office market, in Southwest Florida finally started to come alive in 2013 with a net absorption of 142,595 square feet in Southwest Florida. Collier County was the outright leader of the tri-county area, taking a commanding 85% of that total. The lesser quality Class B and C markets were, however, more active in Lee County which captured 74% of the net absorption of those categories. The vacancy rates for the overall office market in SW Florida dropped from 15% at the beginning of 2013 to about 13.1% at the end of the year, with Class A vacancy dropping from 21% to 18% in the same period. During 2013 quoted rental rates were essentially flat.
Year-End 2013 – Source: CoStar Property®
Vacancy History – 2006 to 2013 – Source: CoStar Property®
Very minimal new construction occurred over 2013, as well as the previous couple of years, as the effects of the recession put a brakes on any notion of expanding inventory. I believe that we may be on the cusp of change as the market firms up and financing becomes more available again. My real estate practice, which has a strong focus on the Class A office market in Naples saw a wide variety of deals consummated over a broad spectrum of buildings. A sampling of our 2013 deals include:
- Mercato – 1600 s.f. to the law firm of Akerman Senterfitt (Dougall represented the landlord)
- Mercato – 1700 s.f. to the law firm of Wicker Smith (Dougall represented the landlord)
- Kraft Building – 5,600 s.f. to a software company (Dougall represented the tenant)
- Northern Trust Building – 2,000 s.f. to the law firm of Becker Poliakoff (Dougall represented the landlord)
- American Momentum Building – 5,000 s.f. to a financial services company (Dougall represented the tenant)
- SunTrust Building – 10,000 s.f. to Bank of Montreal (Dougall represented the landlord)
- Fifth Third Center – 15,000 s.f. to Hertz (Dougall represented the landlord)
- Fifth Avenue – 5,000 s.f. to Holmes Kurnik law firm (Dougall represented the tenant)
As we look ahead to 2014, we see the further improvement of the office market in general, as inventory continues to get absorbed and the improvement in the economy encourages more business activity.
Dougall McCorkle, MBA
Sales Associate and Commercial Specialist
Premier Commercial, Inc., Licensed Real Estate Brokers
Direct: 239.213.7234
Cell: 239.860.3368
dougall@premiermail.net
