South Florida's commercial real estate market recorded its strongest performance in three years during the first nine months of 2025. Sales across the four main commercial property categories increased compared to the same period last year. This growth happened despite ongoing concerns about office building values, indicating a positive outlook from investors.
Key Takeaways
- South Florida commercial real estate sales reached nearly $10 billion through September 2025.
- This marks the strongest nine-month period since 2022 for commercial transactions.
- Multi-family properties attracted the most investment due to tight housing conditions.
- Office market demand remained strong, with law firms driving significant leasing activity.
- The elimination of Florida's commercial lease tax on October 1, 2025, may further boost the market.
Overall Market Performance and Investment Trends
Between January and September 2025, commercial real estate in South Florida saw almost $10 billion in transactions. This figure represents the highest sales volume for a nine-month period since 2022. The Miami Association of Realtors reported that commercial sales volume has shown a steady increase since 2023, even amid a challenging economic environment.
This sustained growth points to investors holding a positive long-term outlook for the Miami Metro market area. The strong performance covers various commercial sectors, including office, retail, multi-family, and industrial properties.
Market Fact
Commercial property sales in the region grew across all four major categories during the first three quarters of 2025 compared to the previous year.
Multi-Family Sector Leads Investment
The multi-family market continued to attract the most capital during the third quarter. This focus by investors and developers is a direct response to the tight housing market conditions in South Florida. Tens of thousands of new apartment units are currently under construction across the region.
Vacancy rates for multi-family properties remain below the national average across Miami-Dade, Broward, and Palm Beach counties. The median price per square foot for multi-family buildings has increased by at least 75% since before the COVID-19 pandemic. Two of the largest commercial purchases in both Miami-Dade and Broward counties during the third quarter involved apartment buildings.
“Commercial sales volume over a 3-quarter period has steadily increased since 2023 amid a challenging economic environment, indicating investors' positive long-term outlook in the Miami Metro market area,” stated a report from the Miami Association of Realtors.
Key Multi-Family Deals
- Significant investment in apartment buildings across all three major counties.
- Median price per square foot for multi-family properties surged by at least 75% since pre-pandemic levels.
- Low vacancy rates support ongoing construction of new units.
Resilient Office Market Demand
The office market in South Florida has continued to perform well, defying concerns about remote work's impact on demand. Regional office building sales totaled almost $2 billion through September of this year. This data comes from the Miami Association of Realtors.
According to Blanca Commercial Real Estate, law firms played a key role in absorbing office space in downtown Miami. Over one-third of office leasing activity in the downtown area last quarter came from the legal industry. This strong demand has contributed to an increase in median sales prices per square foot for office properties.
Economic Context
The sales activity through the third quarter occurred before the Federal Reserve cut its target short-term interest rate in September. This rate reduction may lower other borrowing costs, including commercial real estate mortgages, potentially stimulating further market activity.
The realtors association noted that robust buyer interest is driving up office asking rents. Blanca data shows that Miami-Dade office rents increased between 6% to 8% from a year ago, depending on the building's quality.
Retail and Industrial Sector Activity
The largest single deal during the third quarter was the sale of Sawgrass Square, a shopping center in Sunrise. This property was acquired by two out-of-state investment firms in August. The purchase was part of a larger portfolio of shopping centers, anchored by Publix supermarkets, spanning two states. The Broward County acquisitions also included four other retail centers in Broward and Palm Beach counties.
Industrial Market Nuances
The industrial sector experienced some volatility. A warehouse complex in Doral, consisting of two warehouses built in 2024, sold for $130 million in September to a California buyer. This was the second-largest regional commercial real estate deal during the quarter.
However, the median price per square foot for industrial space remained largely flat or slightly lower across the region through the third quarter. The realtors association suggested that this softness could be linked to recent tariff increases, which introduce uncertainty for businesses relying on imports and exports.
Impact of Tax Policy Changes
A significant change for commercial real estate in Florida took effect on October 1, 2025. The state's 2% sales tax on commercial leases was eliminated. Florida was the last state to impose this tax. This new law is expected to reduce operating costs for businesses and landlords, potentially making commercial leases more attractive and further boosting market activity in the coming months.
This tax repeal could enhance Florida's competitiveness as a business destination, attracting more companies and, by extension, driving demand for commercial properties across all sectors.
