Average rent on retail space in Palm Beach County, Florida, rose by 8.9%

Average rent on retail space in Palm Beach County, Florida, rose by 8.9%

A record-breaking growth of rent on all types of non-residential properties occurs in Palm Beach, Florida.

Throughout the fourth quarter of 2022, the vacancy rate of retail space remained at approximately 3.5%. The continuing population growth and an influx of tourists will ensure that the 56,600 square meters of space currently under development will be leased out quickly, analysts from Colliers (a professional services provider) believe. The average rent on retail space grew by 8.9%, up to $29.16 per square foot.

The share of vacant office premises in Palm Beach County remained at the level of 8.3% in Q4 2022 due to high tenant activity throughout the year, despite the persevering hybrid work modes. The vacancy rate of industrial space has been growing for three consecutive quarters and reached 3.6% by the end of December.

Approximately 22,000 square meters of industrial space and a whopping 102,000 square meters of office premises are now under construction in the county. Analysts from Colliers, however, forecast that developers of office centers will assume a wait-and-see attitude because of the economic uncertainty and will assess the balance between demand and supply in this region.

Nevertheless, the rent on offices surged by over 9% last year, up to $40.70 per square foot. This is a historic high, but still incomparable to the skyrocketing rent on industrial assets: 22.7%, up to $13.26 per square foot.

The frenzy in the rental market is partially caused by a pause in sales, as many investors are waiting for interest rates to stop growing. If it happens, it is landlords that will dominate the market in 2023 with such a low vacancy rate.

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