Real Estate Analysis and Commentary in Florida

Tampa Bay's commercial real estate market
November 2nd, 2013 2:00 PM

Mike Vogel | 10/31/2013

» Tampa retail lags much of the state with half the rental rates of Miami.

» Sweetbay Supermarket, now owned by Jacksonville-based Bi-Lo, shuttered 22 stores in the Tampa Bay area in 2013 while Trader Joe’s, Sprouts and Earthfare are moving in.

» Retail center owners and alternative users have found common ground. Owners want tenants whose businesses don’t conflict with those of existing tenants, generate traffic for existing tenants and fill space. Charter schools and quick-care medical operations, orthopedic offices and other medical specialties, in which proximity to the patient matters more than proximity to a hospital, want locations near consumers. “It’s a great backfill use,” says Andrew Wright, CEO of commercial real estate firm Franklin Street.

»  Fitness centers and restaurants also are driving absorption, rather than merchandise retailers, but Dick’s Sporting Goods opens next year in an old Saks store in the Westshore Plaza. Movie theater company Cinemark moved into the Lakeland Square Mall on U.S. 98.

» Southeast Hillsborough has among the better retail occupancy rates in the bay area.

» The bay area’s industrial market is struggling. Rental rates are flat, creating opportunity for tenants. Tenants are upgrading to more efficient, modern space. A hefty share of existing inventory is obsolete or well on its way there. But with little new product coming, occupancy rates should increase.

»  Northeast Tampa has the highest vacancy rates.

» The anticipated arrival of Amazon is the 800-pound gorilla in the industrial market.

» In office, Westshore, downtown Tampa and downtown St. Petersburg are the only submarkets generally commanding lease rates north of $20 per square foot.

» Raymond James submitted plans for a 1-million-sq.-ft. campus on the Wiregrass Ranch site in Pasco County. A long approval process awaits. Raymond James says it is “evaluating our occupancy requirements and believe the Wiregrass Ranch property is a good future development opportunity.”

Ryan Cos. expects to deliver a 75,000-sq.-ft. office building this month at Citrus Park Crossing in northwest Hillsborough, a rare major new office building in Tampa Bay. Invest Financial has signed to take 40,000 square feet of it, says CBRE’s Brian Devlin.

Tampa Bay - Commercial Market
  Vacancy Rate Avg. Asking Rent
Sector Quarter 2 2012 Quarter 2 2013 Quarter 2 2012 Quarter 2 2013
Industrial 10.8% 10.2% $4.54 $4.57
Retail 8.8% 9.1% $14.43 $14.11
Office 15.2% 15.4% $19.20 $18.93
Source: Colliers International


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