Stores

Miami’s retail scene thrives despite pandemic-era population decline

Miami’s retail vacancy rate sits below the 4.2% national average, at 3%, according to a real estate investment firm.
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Francis Scialabba

· 3 min read

Retail news that keeps industry pros in the know

Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.

We know Miami for hot weather and hotter parties, and the occasional “Florida man” story. But dating back to the pandemic, when working from home meant working from anywhere, Florida saw a population boom. While it didn’t hit Miami quite the same, the city’s retail landscape is thriving.

Between 2020 and 2022, Florida experienced one of the highest population surges in the nation. While Miami-Dade’s numbers declined, it has enjoyed a renaissance in its retail and dining markets. According to commercial real estate firm Lee & Associates, the influx of new restaurant and retail tenants has pushed “rents to prices second only to New York City,” with one of the lowest vacancy rates in the country.

For example, Gucci is opening a new location in the Miami Design District, a shopping area that will undergo a significant transformation.

  • Gucci’s new store will be its second in the neighborhood, after it opened a women’s boutique nearby in 2017. The company also has two other locations in South Florida.

“Multifamily and industrial continue to be incredibly strong,” John Crotty, principal at Avison Young, told the Commercial Observer. “We’re seeing values really hold there, if not rise. There’s just such a lack of supply of those opportunities on the market, and the demand continues to be really strong.”

Slim pickings: Miami’s commercial vacancy rates were stable on a year over year basis between 2021 and 2022, according to commercial real estate firm MMG Equity Partners. The retail vacancy rate was 4.3% in 2021 and dropped to 3.1% last year. As of Q3 2023, it remained at about 3%. The office vacancy rate was 11% in 2021 and fell to 9.7% in 2022.

  • For comparison, the national retail vacancy rate is currently 4.2%, according to real estate company JLL, and the office vacancy rate was 13.1% in July, according to the National Association of Realtors.
  • Miami-Dade County has roughly 2.6 million square feet of space under construction, and about 1.2 million square feet have been completed in the past year, according to real estate investment firm Matthews.
  • Coral Gables and Miami specifically have seen a combined inventory growth of more than 1.1 million square feet, but Matthews notes that large-scale retail projects (more than 100,000 square feet) have been scarce.

“Despite an elevated construction pipeline bringing new retail space to the market, vacancies are projected to remain tight, especially in the highly sought-after Downtown Miami and Miami Beach submarkets,” Matthews associate Mya Asailov wrote in a report. “These areas, renowned for their lively entertainment and captivating outdoor attractions, continue to allure both residents and tourists, fostering a thriving retail environment.”

Retail news that keeps industry pros in the know

Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.