Everyone wrote off retail years ago. Meanwhile vacancy across South Florida sits under 5 percent, rents keep climbing, and capital is fighting over the little space that comes up.
The national story on retail has been the same for a decade. It is dying, e-commerce won, malls are done. In South Florida the opposite is true, and the gap between that story and the actual numbers is exactly where deals get made.
The numbers
Retail vacancy across South Florida is about 3.5 percent, one of the lowest in the nation. Miami sits near 3.3 percent, Fort Lauderdale around 4.1, Palm Beach 3.7. Asking rents run from the mid-30s into the mid-40s per square foot on prime corridors and are still climbing, up 2.8 percent regionally over the year and more than 7 percent in Palm Beach. Absorption stayed positive at roughly half a million square feet last quarter, and only about 211,000 square feet delivered. There is almost nothing new coming.
Why it stays tight
This is not luck, it is structural. Almost no new retail gets built here, because land is scarce and construction costs do not pencil for most projects. Population keeps growing and the tourists keep coming, so foot traffic holds. And the strongest space, necessity and experiential retail, stays leased and rarely comes up.
When supply is capped and demand is steady, landlords keep pricing power. That is what is happening.
What it means for investors
Capital knows this, which is why buyers are chasing limited inventory and cap rates on good product sit in the high 5s to mid 6s. Well-located South Florida retail throws off durable income and rent growth that is genuinely hard to find in other asset classes right now. The catch is that the best deals rarely list. They move off-market, to buyers who are already in front of the right brokers.
If you want retail exposure in South Florida, get your criteria in front of me and get matched to deals before they hit a portal.
Igor Presman
Commercial Broker · Trybal Group
