Saturday, June 6, 2009

Diminished Buyer Pool in Miami Presents Opportunities for Retail Investors

MIAMI, FL— Retail properties in Miami-Dade County recorded negative net absorption in the first quarter as accumulating job losses stymied retail spending and forced merchants to vacate, according to a second-quarter Retail Research Report by Marcus & Millichap, the nation’s largest real estate investment services firm.

Additional increases in vacancy are expected during the remainder of 2009 as more tenants close and others reduce planned store openings.
“Investment activity has been quiet,” says Kirk Felici, (top right photo) regional manager of the Miami office of Marcus & Millichap.

“For prospective buyers, though, a lack of velocity and a thin investor pool could signal that now may be an opportune time to buy.”

Following are some of the most significant aspects of the Miami Retail Research Report:

· Employment in the county will decrease by 43,000 jobs, or 4.2 percent, in 2009, compared with a loss of 36,400 positions last year. Due to the decline in employment, retail spending is projected to fall approximately 10 percent this year.

· Developers have projects totaling 600,000 square feet slated to come online in 2009, which will expand retail stock 0.8 percent. In 2008, nearly 2.2 million square feet was completed.

· Supply growth will be minimal this year, but demand will remain soft, leading to a 180 basis point increase in the vacancy rate to 8.5 percent. Vacancy rose 160 basis points last year.
· Waning space demand will produce a 4.1 percent decrease in asking rents in 2009 to $23.59 per square foot, compared with a 1.4 percent rise last year. A 5.6 percent decline in effective rents to $20.36 per square foot is projected, one year after effective rents slid 1.7 percent.

For a copy of the complete Miami Retail Research Report, as well as reports on other markets nationwide, visit our website at http://www.marcusmillichap.com/.


Press Contact: Stacey Corso, Communications Department, (925) 953-1716

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