Orlando, Fla. -- Florida's retail development market is moving indoors. According to JLL research, nearly half of all retail commercial construction in Florida in the half of 2014 is taking place in malls and shopping centers.
“While most markets are seeing a boom in grocery-anchored power centers or strip centers, Florida has a distinct need for traditional retail assets that’s driven by the tourist shopper base, which prefers a one-stop shop for their goods along with a climate controlled experience,” said John Schupp, senior VP of retail development at JLL.
Florida’s construction numbers stand in contrast to the rest of the country, where the retail development pipeline remains slim, with just 45 million sq. ft. nationwide under construction. However, Florida benefits from expanding retailers and increasing investment allocations. More than 29% of all new retail deliveries in the United States in the second quarter 2014 occurred in Florida, and its major cities are absorbing the space well.
Tampa is seeing the most robust growth with 1.43 million sq. ft. of space under construction as of second quarter 2014. Miami has 1.42 million sq. ft. under construction, the greatest amount of development in proportion to its existing inventory.
The Florida retail market shows no sign of slowing, despite its loss of momentum during the recession. Development in the state accounts for nearly 13% of retail assets under construction nationwide, and a tidal wave of space is expected to come to fruition during the next nine to 12 months in South Florida, according to JLL research. Liquidity in the financial markets has continued to rise to pre-recession levels, increasing the ability to develop new retail assets, or redevelop older properties.