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Commercial Real Estate
Business Observer Friday, Mar. 8, 2019 2 months ago

In Focus: Fort Myers

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Lee County's largest submarket has posted substantial gains thanks to population and job growth
by: Kevin McQuaid Commercial Real Estate Editor

The Fort Myers submarket of Lee County anchors the commercial real estate industry of Southwest Florida, with a variety of sectors represented. Although the area has long been known as an industrial haven, recent bursts of residential development have led to gains in retail space, offices, self-storage and senior housing.

Although the city and surrounding area was hit hard by the last decade’s economic recession, new product has come online to meet increased demand, according to CoStar Group data.

Vacancy rates in Fort Myers, meanwhile, have dropped to pre-recessionary levels in the industrial and office sectors, while rental rates have bumped up and exceeded inflation significantly, at least with industrial space, which continues to outshine other sectors.

Even so, commercial real estate development has largely been disciplined in the retail, office and industrial sectors. Most of the new product being delivered has been substantially pre-leased, is in areas of high residential growth with solid prospects or is being built on a build-to-suit basis by well-capitalized developers with a track record in Southwest Florida.

 

200,961

Amount, in square feet, of the largest new industrial project delivered in Fort Myers during the fourth quarter of last year. Timonium, Md.-based Knott Realty Group’s 27-acre Meridian Center development is being constructed on a speculative basis near the Southwest Florida International Airport. The buildings there will feature 32-foot clear ceiling heights and a 130-foot truck court. Lee & Associates Inc. is handling leasing.

 

$7.65

Quoted rental rate on a per square foot basis for the largest industrial building under construction in Fort Myers at year end. The building, in the Premier Airport Park, will measure 106,836 square feet upon completion in the second quarter. Premier Airport Park is a Class A, 225-acre complex adjacent to the Southwest Florida International Airport slated to contain 1.8 million square feet at build out. Colliers International is handling leasing.

      

 3.2% 

Amount of vacant industrial space, in a percentage basis, in Lee County at the end of 2018. The City of Fort Myers’ vacancy is lower, at 1.9%, but South Fort Myers, a slightly larger submarket, had a 4.5% vacancy.

 

396,227

Amount of industrial space in square feet under construction at the end of 2018 in Fort Myers. The overwhelming majority of the new space — 300,711 square feet — is in South Fort Myers.  

 

60,000

Amount of space, in square feet, of the largest new industrial lease signed in Fort Myers in 2018. Amazon took down the Airport Woods Commerce Center building for a “last mile” fulfillment center, a project slated to employ 500. The 10016 Bavaria Road building is roughly four miles from Southwest Florida International. Lee & Associates negotiated the lease on behalf of owner KP Properties of Florida.

 

100%

Percentage of space committed in the largest new office building under construction in Fort Myers. Gartner Inc.’s 143,000-square-foot building is one of three the business consultant is planning in Lee County to meet internal growth. In all, the company employs 1,600 in Lee County and occupies about 300,000 square feet of office space currently. About 337,700 square feet of new office space was under construction in Fort Myers at year end.

 

11.4%

Amount of office space, on a percentage basis, vacant at year end in the City of Fort Myers. The percentage of available space in South Fort Myers was nearly half that amount, at 5.9%.

 

$14.38

Amount per square foot office landlords were seeking in rent at year-end 2018 in South Fort Myers. The asking rate was slightly lower, at $11.76 per square foot, in the City of Fort Myers.

 

68,025

The amount of space in square feet of the largest office lease in Fort Myers in 2018. Alta Resources renewed its commitment at 12451 Gateway Blvd. in a deal negotiated by Cushman & Wakefield Commercial Property Southwest Florida. The South Fort Myers’ operation is one of four the company maintains in the U.S. and the Philippenes.

 

110,532

Amount of space, in square feet, in the largest new retail project delivered in Fort Myers in 2018. The Whole Foods Market-anchored center, at 6891 Daniels Parkway, opened in late 2018. The 52-acre project, which is also occupied by HomeCentric, Mellow Mushroom and Zoe’s Kitchen, among others, was developed by SJ Collins Enterprises. LandQwest Commercial Realty is handling leasing.

 

22,000

Amount of space, in square feet, of the largest retail project under construction at year-end 2018 in Fort Myers. The 9345 Six Mile Cypress Parkway project, which is anticipated to be completed in the second quarter, is being developed by Manatee County-based Benderson Development Co. It is part of a roughly 500,000-square-foot retail hub whose tenants include Publix Super Markets Inc., Kohl’s, Hobby Lobby, BJ’s Wholesale Club, T.J. Maxx, and others.

 

4.4%

The amount of retail space, on a percentage basis, vacant in Fort Myers at the close of last year. Though a larger submarket overall, South Fort Myers performed better than the City of Fort Myers in terms of positive absorption of space in 2018. Rental rates in South Fort Myers stood at $16.20 per square foot, vs. $12.05 in the City of Fort Myers.

 

 

        

 

Source: CoStar Group Inc.

 

 

        

 

 

 

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