The Fort Myers-Cape Coral metropolitan area saw the largest increase in commercial rents in the country last year, while in Florida as a whole the cost of leasing commercial space for business owners is rising.
Outsource2Indiaa business outsourcing service provider, led the study on commercial and office space rental prices for the first quarter of 2024.
The top 10 most expensive markets for commercial space were dominated by metropolitan areas in California, which made up four of those 10 areas. The San Jose-Sunnyvale-Santa Clara metropolitan area, home to a variety of technology companies, topped the list, where office space cost an average of $58 per square foot.
The study analyzed the office and commercial rental markets in major U.S. metropolitan areas using data from the National Association of Realtors (NAR).
The Miami-Fort Lauderdale-Pompano Beach metropolitan area ranked fourth on the list. In Florida’s largest market, commercial space rent currently averages $50 per square foot.
The study compared this year’s commercial rents with those in 2023. Overall, there was little change in office rents in most areas of the U.S. In about 74% of metropolitan areas, there was little change in rents for business owners.
But Florida bucked this trend. “Interestingly, Florida appears to be a very dynamic market, with 55% of metropolitan areas increasing office rents,” the study concluded.
One community in Southwest Florida may not have made the top 10 most expensive commercial rents, but it did experience some of the most dramatic increases in commercial rents. In the Cape Coral-Fort Myers metropolitan area, commercial rents and price per square foot increased 8.3% last year.
In fact, the rent increase for offices and shops in Cape Coral-Fort Myers was the largest annual increase in the entire country.
Abilene, Texas, came in second with an increase of 6.67% over the past year.
The Miami-Fort Lauderdale-Pompano Beach metropolitan area was the only Southeastern U.S. market in the top 10 for overall most expensive prices in the U.S. The Austin-Round Rock-Georgetown region of Texas was the only other Sun Belt metropolitan area in the top 10 list, coming in at number 5 with an average price of $44 per square foot.
“These results underscore the complex dynamics that prevail in the office space market. Florida appears to be doing better than other states in terms of office leasing market growth. California is struggling more with its very high prices,” the study said.
When it comes to the cheapest office rents, Florida’s metropolitan areas don’t top the list. Four markets were tied for the lowest office rents at $15 per square foot, including Canton-Massillon, Ohio, Erie, Pennsylvania, Wichita Falls, Texas and Youngstown-Warren-Boardman, Ohio.
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