Sorry Don Henley, Glenn Frey and the other Eagles. Love very well may keep us alive yet for the moment, we need jobs. To this end, there has been a lot of chatter in regional and national news about office-using employment.
Recently, one of our respected competitors in the Big Apple distributed some weekly economic news, citing September data from the U.S. Labor Department that 105,000 jobs nationwide were added to the employment roster in positions across three main office-using sectors – financial services, professional and business services, and information services. It is only the fifth time in the past decade that office-using employment increased by more than 100,000 in a single month.
Locally, the Miami office market is in the midst of a slow recovery and some of our commercial real estate sub-markets, such as Coral Gables, are benefiting from the addition of more jobs. Through the first three quarters this year, nearly 200,000 square feet of office space has been positively absorbed in Coral Gables. This may explain why the unemployment rate is among the lowest for a South Florida city, at 4.5 percent
However, if we look at the region’s demographics, population trends and household growth patterns, Downtown Miami is a real head turner.
Consider this: The Greater Downtown, which is comprised of Brickell, the Central Business District, Arts & Entertainment, Wynwood/Edgewater and Overtown neighborhoods, had a population of 33,888 in the 2010 Census. The 2014 estimate for this core area is 44,773 people (about 28% growth!) and the forecast is that by 2019 the Greater Downtown population will exceed 48,000 people, according to the Miami Downtown Development Authority.
The challenge for the office market, however (and as previously stated), is that we are using less space per employee and with office-worker density on the rise, there is less demand for office space. This is why vacancy rates have stayed stubbornly high. Office workers are now averaging about 125 square feet of office space per person and way off the former mark of more than 200 square feet per person. The industry expects that number to get to around 100 per within a few years. European office workers already average just 80 square feet per person.