Trade between Latin American countries and the United States is shaping South Florida’s industrial market.
The amount of exports and imports traded increased by 9.1% year-over-year in 2018 up to 2.4 million tons, according the 2019 South Florida Industrial Market Outlook report by Houston-based commercial real estate firm Transwestern.
South Florida seaports — including PortMiami, Port Everglades and Port of Palm Beach — saw an increase by 15.2% year-over-year in 2018 up to 18.9 million tons.
The trade activity will draw more interest to industrial real estate in Miami-Dade County, Walter Byrd, executive managing director for Florida operations at Transwestern Commercial Services, said.
Although demand for warehouse space and rent growth come primarily from more consumers in South Florida, Byrd said, continual trade activity will contribute to an increase in industrial leases in 2020.
“Small increases of demand does move markets,” Byrd said. “All of those increases move upward pressure on rates.”
Rental rates in the county’s industrial market remained steady in 2019. Warehouses and distribution centers asked on average for $9.82 per square foot and manufacturing spaces requested $8.50 per square foot, according to the third quarter 2019 Colliers International Miami-Dade County industrial market report.
Rental growth will range between 3% to 5% across the Miami-Dade County industrial market over the next 12 months, said Byrd.
Besides the United States importing more refrigerated produce, the exclusion of Latin American countries from U.S. tariffs, until early December, led to more material flowing through South Florida, the Transwestern report said.
“The trade war has led to some benefits for South Florida,” Byrd said. “China was shopping more in Brazil and Argentina, helping the middle classes grow in South America’s two largest economies. And a strong middle class means more demand of goods with much of it flowing through South Florida.”
The biggest trade partners for South Florida’s ports include the Dominican Republic, China, Honduras, Guatemala and Colombia, according to the Transwestern report. The Dominican Republic and Honduras will continue to see GDP growth, the report said, and will likely remain top partners for the three ports.
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