by Chad Massaker | May 1, 2023 | Commercial Real Estate, Commercial Real Estate Investment, Ft. Lauderdale, Industrial, Miami, Palm Beach, South Florida
The industrial market in South Florida is currently experiencing significant growth and development. As a result of a rapidly expanding population, increased demand for goods and services, and a favorable business environment, the region’s industrial sector is thriving.
One of the primary drivers of the South Florida industrial market is its location. South Florida is strategically located at the crossroads of the Americas, making it an ideal hub for logistics and transportation. The region boasts one of the largest ports in the country, PortMiami, which handles a significant amount of international trade. Additionally, South Florida’s airports, highways, and rail networks provide easy access to both domestic and international markets.
Another factor contributing to the growth of the industrial market in South Florida is the region’s favorable business environment. Florida has no state income tax, making it an attractive location for businesses looking to expand or relocate. Additionally, the state has implemented pro-business policies that have made it easier for companies to operate and do business in the state.
The demand for industrial space in South Florida has also been driven by the growth of e-commerce. As more consumers shop online, there has been an increased demand for warehouses and distribution centers to store and process goods. The COVID-19 pandemic has only accelerated this trend, as more consumers are opting for online shopping due to health and safety concerns.
The industrial market in South Florida has seen a significant increase in new construction and development activity. According to a recent report by CBRE, over 10 million square feet of industrial space was under construction in South Florida in the first quarter of 2021. This marks a 40% increase compared to the previous year. The majority of this new construction is focused on distribution centers and warehouses, reflecting the growing demand for e-commerce facilities.
Despite the strong demand for industrial space in South Florida, there are some challenges that the market is facing. One of the primary challenges is the availability of land. As the region’s population continues to grow, land prices have increased, making it more difficult and expensive for developers to find suitable sites for new construction. Additionally, there is a shortage of skilled labor in the construction industry, which has led to delays and increased construction costs.
In conclusion, the state of the industrial market in South Florida is robust and growing. The region’s favorable business environment, strategic location, and the growing demand for e-commerce have all contributed to the market’s success. While there are some challenges, such as the availability of land and skilled labor, the outlook for the South Florida industrial market remains positive. As the economy continues to recover from the COVID-19 pandemic, the demand for industrial space is expected to remain strong.
by Chad Massaker | Apr 4, 2023 | Commercial Real Estate
The decision to lease or buy commercial real estate depends on your specific situation and needs. Here are some factors to consider:
- Financial Resources: Buying commercial real estate requires a substantial amount of money upfront for the down payment and closing costs. If you have the financial resources to make this investment, then buying might be a good option.
- Cash Flow: Leasing allows for more flexibility and less upfront costs, which can be beneficial if your business is just starting or if you have limited cash flow. On the other hand, if you have steady cash flow and want to build equity in a property, buying may be the better option.
- Long-Term Goals: If you plan to stay in the same location for a long period of time, buying commercial real estate may be a wise investment. However, if you anticipate needing to move or expand in the near future, leasing may be the better choice.
- Market Conditions: The state of the real estate market can also impact your decision. If property values are high and rental rates are low, leasing may be more cost-effective. Conversely, if property values are low and rental rates are high, buying may be the better option.
Ultimately, it is important to carefully weigh the pros and cons of leasing and buying commercial real estate and to consult with a real estate professional to help you make an informed decision based on your specific needs and circumstances.
by Chad Massaker | Mar 29, 2023 | Commercial Real Estate, Flex, Ft. Lauderdale, Industrial, Land, Leasing, Miami, Office, Palm Beach, South Florida
Commercial leases are agreements between a landlord and a tenant that allow the tenant to occupy a space for commercial purposes. There are several types of commercial leases, each with its own unique features and benefits. Here are some of the most common types of commercial leases:
- Gross lease: A gross lease is a lease in which the tenant pays a single flat rate for rent, and the landlord is responsible for paying all of the property expenses, including utilities, taxes, and maintenance.
- Net lease: A net lease is a lease in which the tenant pays a base rent and also pays for some or all of the property expenses, such as property taxes, insurance, and maintenance. There are three types of net leases: single net lease, double net lease, and triple net lease, each with different levels of responsibility for the tenant. gg
- Percentage or Performance lease: A percentage lease is a lease in which the tenant pays a base rent plus a percentage of their sales revenue. This type of lease is often used for retail properties.
- Modified gross lease: A modified gross lease is a lease in which the tenant pays a base rent, and the landlord is responsible for paying some property expenses, while the tenant is responsible for paying others. This type of lease is often used for office spaces.
- Ground or Land lease: A ground lease is a lease in which the tenant leases only the land and is responsible for constructing any buildings or structures on it. This type of lease is often used for long-term commercial developments, such as shopping centers.
The type of commercial lease that is most appropriate for a particular business depends on a variety of factors, including the nature of the business, the length of the lease, and the financial resources of the tenant.
by Chad Massaker | Mar 27, 2023 | Flex, Ft. Lauderdale, Industrial, Land, Leasing, Miami, Palm Beach, Retail, South Florida
by Chad Massaker | Mar 15, 2023 | Commercial Real Estate, Commercial Real Estate Investment, Flex, Industrial, Land, Leasing, Multifamily, Office, Retail
DSCR stands for Debt Service Coverage Ratio, which is a financial metric used to measure a company’s ability to pay its debts. It is a ratio of a company’s net operating income (NOI) to its debt service payments, which includes both principal and interest payments.
The debt service coverage ratio is calculated by dividing the company’s NOI by its total debt service payments. The higher the DSCR, the more capable the company is of paying its debts.
- A DSCR of 1 indicates that the company is generating just enough income to cover its debt service payments.
- A DSCR ratio of less than 1 means that the company is not generating enough income to cover its debt payments.
- A DSCR of more than 1 indicates that the company is generating sufficient income to cover its debt payments, with higher ratios indicating a stronger financial position.
Lenders use DSCR as a measure of creditworthiness when considering loan applications. A DSCR of 1.2 or higher is generally considered a good indicator of a company’s financial health, although the ideal ratio may vary depending on the lender and industry.
However, it’s important to note that DSCR is not the only factor that lenders consider when assessing creditworthiness. Other factors such as the company’s financial history, cash flow, collateral, and industry trends are also important in determining whether a company is creditworthy.
by Chad Massaker | Mar 15, 2023 | Commercial Real Estate Investment, Industrial, Land, Leasing, Multifamily, Office, Retail
“The Complete Guide to Real Estate Finance for Investment Properties” by Steve Berges: This book covers the financial aspects of real estate investment, including commercial real estate.
“The Due Diligence Handbook For Commercial Real Estate” by Brian Hennessey: This book is a comprehensive guide on how to conduct due diligence on commercial real estate properties.
“The Intelligent REIT Investor: How to Build Wealth with Real Estate Investment Trusts” by Stephanie Krewson-Kelly and R. Brad Thomas: This book explains how to invest in real estate investment trusts (REITs), which are a popular way to invest in commercial real estate.
“Real Estate Investing For Dummies” by Eric Tyson and Robert S. Griswold: This book provides an overview of real estate investing, including commercial real estate.
“The Millionaire Real Estate Investor” by Gary Keller, Dave Jenks, and Jay Papasan: This book provides advice on investing in real estate, including commercial real estate, and shares the strategies of successful investors.
“Commercial Real Estate Investing” by Dolf de Roos: This book provides a step-by-step guide to investing in commercial real estate, including how to find properties, finance deals, and manage properties.
“The ABCs of Real Estate Investing” by Ken McElroy: This book covers the basics of real estate investing, including commercial real estate, and provides tips for finding and analyzing properties.
Books to Read if You’re Considering a Career in Commercial Real Estate:
“Thrive: Ten Prescriptions for Exceptional Performance as a Commercial Real Estate Agent” by Blaine Strickland: Proven strategies to accelerate your commercial real estate brokerage career.
“Adapt: Disruption Is Coming to Commercial Real Estate Brokerage.” The nine forces that are poised to disrupt your world.
DSCR stands for Debt Service Coverage Ratio, which is a financial metric used to measure a company’s ability to pay its debts. It is a ratio of a company’s net operating income (NOI) to its debt service payments, which includes both principal and interest payments.
“The Complete Guide to Real Estate Finance for Investment Properties” by Steve Berges: This book covers the financial aspects of real estate investment, including commercial real estate.