In Focus: Sarasota/Bradenton

The Sarasota and Bradenton submarkets have posted considerable activity in the past year, especially in the multifamily rental, office and industrial sectors.

In a few cases, development and leasing deals have been among the top transactions for the entire market, which also includes Tampa, St. Petersburg, Clearwater, and Pasco and Polk counties, according to CoStar Group data.

As has been the case elsewhere throughout the Gulf Coast, vacancy rates in Sarasota and Bradenton — for its retail, office and industrial sectors — have declined over the past three years, while rental rates in each sector have edged upward.

Development has largely been tempered, however, despite a plethora of new residential growth. There were just three new office buildings under construction in the Sarasota and Bradenton areas at the mid-year mark, four new industrial buildings and a dozen new retail offerings.

5.5%

Percentage of office space available in the Sarasota and Bradenton submarket as of June 30. By comparison, 7.0% of all the office space in the Tampa/St. Petersburg market as a whole was available at the close of the second quarter. In all, 1.4 million square feet remained uncommitted in the two cities. Three years ago, the vacancy rate stood at 8.6%.

$20.62

Quoted rental rate on a per square foot basis for all office space in Sarasota and Bradenton as of mid-year 2018. The rate was just under the $21.10 per square foot average marketwide. At the end of the second quarter of 2015, the average rental rate in Sarasota and Bradenton was $18.68 per square foot.

4      

Number of industrial buildings under construction in Sarasota and Bradenton as of June 30. In all, the four contain 422,000 square feet of space and were only 6.2% pre-leased at the time construction commenced.

202,661

Amount of retail space, as measured in square feet, under construction in the Sarasota/Bradenton submarket at the end of the second quarter. Of the total, 80.4% was pre-leased prior to the start of construction.

74,000

Amount of space, measured in square feet, in the largest new office building under construction in the submarket as of June 30. The 3025 Lakewood Ranch Blvd. project, slated for delivery in early 2019, is being developed by Tampa-based Harrod Properties Inc. in the master-planned community.

2.4%

Percentage of industrial space available throughout Sarasota and Bradenton at the end of the second quarter. The vacancy compared to the rate for the Tampa region as a whole, of 4.9%.

$7.93

Average industrial rental rate per square foot in Sarasota/Bradenton at the end of the second quarter. Regionwide, the industrial rate stood at an average $6.17 per square foot during the same period.

$36,500,000

Amount North Carolina-based Dilweg Cos. spent to acquire the 13-story Sarasota City Center office building in downtown Sarasota in April 2017. Dilweg’s purchase, at a 7.8% cap, marks the largest in the city in the past 18 months.

41,730

Amount in square feet of the largest retail lease in 2018 in the Sarasota and Bradenton markets. Big Lots’ deal in Gator Investments’ Town and Country Plaza, in Sarasota, took down vacant Kmart space.

246,000

The largest industrial building under construction in the Sarasota/Bradenton market as of June 30. The building in the Florida International Trade Port, from Benderson Development Co., is being delivered on a speculative basis. Completion is scheduled for the first quarter of 2019.

$15.40

Average rental rate, on a per square foot basis, for retail space in Sarasota/Bradenton submarket at the end of the second quarter. The rate mirrors that of the entire region. Vacancy, at 4.3%, also is on par with that of the region, at 4.5%.

82,694

The largest industrial lease in the Sarasota/Bradenton market as of June 30. The 7839 Fruitville Road building was fully leased by Outdoor Furniture By Design, following a move by former tenant Scott Paint to Orlando, in a deal negotiated by American Property Group of Sarasota’s Brian Seidel.

$33,451,000

The amount of the largest retail sale in the entire Tampa/St. Petersburg market from April 2017 through the end of June 2018. Brixmor Property Group made the investment in the Venice Village Shoppes, in Venice, buying the 187,885-square-foot center from Bronstein Properties LLC. Brixmor paid $178.04 per square foot for the seven-year-old property, or a 5.85% cap, in November 2017.

55,400

Amount of space, in square feet, of the largest retail property under construction in the Sarasota/Bradenton submarket as of June 30. The University Corner property, at University Parkway and Lorraine Road in Lakewood Ranch, is being developed by North American Properties, of Cincinnati, through its Fort Myers’ office. The 20-acre site, which is anchored by a 46,500-square-foot Publix supermarket, opened in September.

Source: CoStar Group Inc.