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South Florida office cap rates among lowest in nation

• Miami has some of the lowest Class A office cap rates in the nation, with rates for Class A buildings ranging between 4.50 percent and 5.25 percent on average – on par with markets like New York, Boston, and Atlanta.

• Amidst heavy investment in recent years, cap rates have been on the decline, particularly in Miami. Miami cap rates have routinely been reported under the 5.0 percent threshold since the end of 2015. In that time, nearly $2.0 billion in Class A office transaction occurred in Miami. The sale of Southeast Financial Center, the largest East Coast office building south of New York, and the iconic Miami Tower – both in Downtown Miami – accounted for over $700 million in sales volume.

• Fort Lauderdale in that time also saw heavy investment of over $1.2 billion in Class A office transactions, and while cap rates are still higher than in Miami, they have been declining at a faster pace.

Source: JLL Research




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