February news reports indicated a significant uptick in Florida real estate deals. Cold weather in the North and other factors have been driving the investment boom.
Explore some of the current facets of the commercial real estate wave in the Miami metro and beyond.
Increased tourism
While travel has stalled in much of the Northeast, many residents of those states have traveled to Florida. As a result, New York real estate investors have increasingly entered the hospitality market in South Florida. NBC Miami reported in February 2021 that Miami hotels are currently running full occupancy compared to an occupancy rate of under 10% in New York City. Restaurant investment in Florida is also on the rise with the prevalence of outdoor dining, a reality year-round in the Sunshine State.
Economic factors
Commercial real estate provides some of the best returns for investors in our economic climate. With record low federal interest rates, other investment vehicles have a much lower potential return at the moment than the possible profits investors could realize from South Florida commercial real estate. Many sectors within this industry have shifted from speculative investment to a sustainable, long-term pursuit.
Preference for condos
Residents of New York and other chilly cities tend to prefer condo properties to single-family homes when moving to Miami and surrounding areas. They appreciate the security and amenities provided by luxury condominium buildings while enjoying the spacious feel that lacks in Manhattan spaces.
With these factors in mind, investors should consider opulence when investing in South Florida commercial real estate. Tourists and new residents alike are seeking top-tier homes, restaurants and hotels for their seasonal stays.
