Commercial Boulevard Office Vacancies Soaring

Written by on November 14, 2012 in News - No comments
2101 W Commercial Boulevard

The office market along the heart of uptown Fort Lauderdale’s Commercial Boulevard offers easy access to Interstate 95 and Florida’s Turnpike and good bargains for businesses seeking breaks on rent.

The mostly older buildings are losing their appeal as tenants leave the stretch for newer and more upscale complexes across Broward County and South Florida.

Real estate brokers say they’re having to forgo traditional office tenants along Commercial and instead are targeting more medical businesses and schools.

“We’re chasing the deals, just like everybody else in that market,” said Peter Reed, a broker at Commercial Florida Realty Services in Boca Raton.

Another broker was even more blunt.

“It’s like hand-to-hand combat retaining and attracting tenants there,” said Jonathan Kingsley, senior vice president at Jones Lang LaSalle in Miami.

As businesses recover from the recession, the region’s most prestigious office buildings are almost fully leased. But second-tier properties continue to struggle. Tenants often prefer newer buildings to them because they offer more efficient layouts and high-speed Internet connections.

Between I-95 and the turnpike, there are 17 buildings in the Commercial Boulevard market consisting of 1.1 million square feet. The vacancy rate is 27.5 percent, well above the 16.5 percent vacancy for all of Broward, according to Commercial Florida Realty.

A 167,270-square-foot building at 2050 Spectrum Boulevard is almost a third vacant, as is a building at 2101 W. Commercial Blvd. Some of the smaller buildings are half-empty.

BellSouth, Orlove Pharmaceuticals, Northwestern Mutual and the Katzman Garfinkel & Berger law firm are among the tenants to leave the Commercial Boulevard market in recent years.

Katzman Garfinkel leased 18,000 square feet at 1501 NW 49th Street for about three years but left in 2011 when it bought a larger building in Margate.

Along Commercial, the firm often found its parking spaces filled by students from a local college, said Donna Berger, managing partner of Katzman Garfinkel. What’s more, the layout of the building was inconvenient, she said.

“When you’re running a business, you’re looking for a big space, parking, and for it to be easy for clients and customers to find you — and you want them to be comfortable when they get there,” Berger said. We had a happy home there for years, but at the end of the day, we just outgrew it.”

Competition from the Cypress Creek market and other complexes in southwestern Broward will make it difficult for Commercial to make a comeback, brokers say.

“There really is no great hope for that corridor,” Kingsley said. “We project that it will always be a secondary market.”


Sources: Sun-Sentinel

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