In a recent interview with Bisnow, Mark Levy, the President of BBX Logistics Properties, shared his perspectives on the current state of the industrial market in South Florida. Despite concerns over economic instability impacting the sector, Levy emphasized the sustained demand for industrial space. This article provides an overview of the interview and highlights key points from Levy's discussion.
Strong Market Performance: While the national industrial vacancy rate stands at 3.9%, South Florida has demonstrated a robust market with a Q1 vacancy rate of 3.7%, below the national average. Furthermore, the region has seen a significant increase in construction activity, with 13.3 million square feet currently under development compared to 10.4 million square feet last year. These figures indicate positive growth and resilience in the South Florida industrial market.
BBX Logistics Properties' Approach: BBX Logistics Properties, a South Florida-based logistics development company backed by BBX Capital Real Estate, has been actively seeking opportunities that others may overlook. Levy highlighted the firm's focus on quickly meeting the evolving needs of clients and the industry as a whole. By utilizing a specific set of analytics and data intelligence, BBX Logistics Properties aims to identify and analyze development opportunities effectively. Levy emphasized the importance of investment fundamentals and sustaining long-term value in a market that is normalizing and experiencing value resets.
Speaking at Bisnow's South Florida Industrial and Logistics Summit: Levy expressed his enthusiasm for speaking at Bisnow's event, emphasizing the platform's ability to reach a broad audience and facilitate conversations about market opportunities and challenges. During the summit, he intends to discuss effective navigation of market uncertainties, underwriting approaches, rental rate growth forecasts, evolving demand, and the changing landscape of South Florida's logistics sector.
BBX Logistics' Business Plan and Projects: BBX Logistics Properties began with no pipeline and has focused on taking on challenging projects that others may shy away from. With an experienced team guiding them through the complex entitlement process, the firm is currently involved in multiple projects in Broward and Palm Beach counties. They have recently received final approvals for a 700,000 square feet, three-phase project in Delray Beach, which exemplifies their commitment to delivering top-quality logistics space in constrained, high-barrier locations. Beyond Florida, BBX Logistics Properties has a pipeline of opportunities in other eastern U.S. markets.
Long-Term Goals: Levy shared BBX Logistics Properties' goal of building an enterprise that maximizes value for their investment partners, customers, and the community. The firm aims to focus on key markets in Florida while also considering opportunities in growth markets such as Charlotte, North Carolina, Texas, and the New York/New Jersey area. Levy emphasized their commitment to disciplined decision-making and avoiding speculative ventures.
Challenges for Investors and Developers in South Florida: One of the primary challenges faced by industrial investors and developers in South Florida is the availability of land. The industry needs to explore vertical and mixed-use orientations to address future project development. Levy also mentioned the potential impact of Florida Senate Bill 102, which may allow affordable housing to be constructed alongside commercial or industrial sites. Other challenges include the cost of money, labor shortages in construction, and the need for diligent due diligence and comprehensive deal analysis.
Trends in the South Florida Industrial Market: Levy highlighted the increasing trend of redevelopment across South Florida, including repurposing obsolete office and retail assets, as well as revitalizing older industrial properties. Mixed-use developments are gaining traction in the region. BBX Logistics Properties places a strong emphasis on social and environmental impacts, aiming to be a role model for community involvement and environmental stewardship. They seek building certifications to reduce their environmental footprint and operate at the highest standards of efficiency.
The South Florida industrial market demonstrates resilience and sustained demand despite economic uncertainties. BBX Logistics Properties, with its focus on analytics and data intelligence, continues to identify and capitalize on market opportunities. Mark Levy's insights at Bisnow's South Florida Industrial and Logistics Summit will shed light on effective strategies, challenges, and trends shaping the region's industrial sector.
(Note: The above is a rewritten version of the article, giving credit to the original author and source: Emily Lynch, Studio B Writer, in collaboration with BBX Logistics Properties, from the Bisnow article published on June 7, 2023.)
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