Fort Lauderdale continues to grow with Broward County ranked as the fastest growing county in South Florida and many large new companies choosing to move their corporate headquarters there, according to Tim Talbot and Ron Winokur, directors of office leasing at The ComReal Companies. Many technology corporations are choosing Broward over Miami-Dade County. In addition, there is a growing influx of law firms and financial centers moving into the Fort Lauderdale area.

At the end of 2000, Southwest Broward County had an estimated 5.9 million square feet of office space out of a total of 22.2 million for the entire county, according to Pike Rowley, director of Codina Realty Services. This submarket also boasted an absorption rate in excess of 850,000 square feet for 2000.

The majority of development in the Fort Lauderdale area is currently taking place in the Cypress Creek, downtown Fort Lauderdale and Southwest Broward submarkets. All new projects are either Class A in the downtown area or Class B+ or A- in the suburbs. There are very few Class C products under development.

Significant developments within the Cypress Creek submarket include Pinnacle II Corporate Park, a multi-tenant building leased by Podolsky Associates of Florida, and Cambridge Executive Center Building II, a Class A, 140,000-square-foot office building that houses Citrix Systems Inc. Developments within the southwest submarket include the 128,447-square-foot Royal Caribbean Center at Monarch Lakes, leased by Opus South Corp. The entire building of Class A office space will house the headquarters of Royal Caribbean Cruise Line in the City of Miramar. New York-based developer the Rockefeller Group, is also constructing a 250,000-square-foot office campus for Lucent Technologies.

Codina Group Inc. and Stiles Corp. are also very active office developers in Broward County. Codina Development Corp., an operating division of Codina Group, is developing the 240,000-square-foot American Classic Tower building located in Sawgrass Commerce Center in Sunrise, Fla. American Classic Voyages Cruise Lines will relocate its corporate headquarters to approximately 130,000 square feet of space in the building. In addition, Codina is developing Beacon Point at Weston, a 400,000-square-foot office park in Westin, Fla. The project consists of four, 100,000-square-foot office buildings which are in various stages of development. The first building, which was completed in the fourth quarter of 1999, is 100 percent pre-leased; the second building recently received its certificate of occupancy and is 80 percent pre-leased; the third building is under construction for completion in the fourth quarter of 2001 and is experiencing tremendous pre-leasing activity; and construction of the fourth building is scheduled to commence in the first quarter of 2002.

Stiles Corp. has begun construction on a 300,000-square-foot office tower in downtown Fort Lauderdale, which is approximately 30 percent pre-leased with occupancy scheduled for the fourth quarter of 2002. Stiles is also building a 100,000-square-foot office building in Sawgrass Commerce Center in Sunrise.

"Developers are more discerning today," says Rowley. "They are leasing office space prior to the start of construction to ensure that the market demand is strong." In a vibrant economy, he says, developers didn't have to land bank parcels for a very long period of time because the development of projects would begin before or directly after the completion of an acquisition. But the recent slow down in the economy has caused vacant land to stay on the market longer. "We'll begin to see a drop in prices," Rowley adds, "but we have not witnessed a drop in rates or compromised terms on present lease negotiations."

Developers new to the Fort Lauderdale area include Opus South Corp., which is constructing properties in southwest Broward and the Sawgrass submarkets, The Alter Group, which is developing in the Cypress Creek and Sawgrass Park areas, Rockefeller Group, which is developing in the City of Miramar, and Douglas-Smith, which is developing SunWest Business Center in the City of Sunrise.

Major leases that have been closed recently include Sara Lee' 267,550-square-foot expansion at 2965 Weston Rd. in the Weston Business Center; Citrix Systems Inc.' 140,000-square-foot expansion at 875 West Cypress Creek Rd. in Cambridge Executive Center II; Andrx Corp. Inc.' 128,000-square-foot expansion at 2755 Weston Rd.; and American Classic Voyage' new 130,000-square-foot facility in Sawgrass Commerce Center.

Lucent Technologies also leased 250,000 square feet in Miramar, and Convergys leased more than 100,000 square feet in Tamarac, Fla. Codina Realty Services ONCOR International, an operating division of Codina Group, recently signed three major leases, including a lease for 130,000 square feet with American Classic Voyages at Sawgrass Commerce Center in Sunrise, a 60,000-square-foot lease with ParkStone Medical Information Services at Beacon Pointe at Weston and a lease for 60,000 square feet of space with Gilat Satellites at Sawgrass Commerce Center. Opus South signed two major deals in 2000, including one for 130,000 square feet of space with BellSouth in Sunrise.

Class A rental rates range from $16 to $34 and vacancy rates range from 10 to 12 percent. Submarkets to keep an eye on for the near future, according to Talbot and Winkokur, are southwest Broward, including the cities of Miramar, Pembroke Pines, Weston and Sunrise, and also the Cypress Creek and Sawgrass submarkets.

"Land is king," says Rowley. "And the only area in Broward County with any substantially large acreage parcels available is Southwest Broward County." The popularity of the market, according to Rowley, is directly related to two major factors: the residential quality of life and the ease of transportation. After Hurricane Andrew, people began to move into Broward County from Miami-Dade County because of the destruction in that area. This generated a housing explosion that contributed to the creation of retail, office and industrial developments. Corporate employers found that most mid- and upper-level management preferred living in Southwest Broward County because of its vibrant residential communities and ideal access to Miami-Dade County, downtown Fort Lauderdale, Hollywood/ Fort Lauderdale International Airport and Port Everglades. This brought about the relocation of some regional and Latin American headquarters to this area, including those for Royal Caribbean Cruise Lines, American Classic Voyages, Lucent Technologies and Gilat Satellites.

Despite signs of a slowing national economy, Rowley remains optimistic about the area' future: "South Florida historically has remained slightly insulated from the economic downturns experienced in the rest of the country," he says. "Tourism, Latin American trade and consistent housing growth are three variables that keep us bolstered in tough times."

Tim Talbot and Ron Winokur are directors of office leasing with The ComReal Companies.


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