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Real Estate Bisnow
The largest commercial real estate publication in the United States.
January 5, 2012 

Planes, trains, and cargo ships have arrived here from Latin America for many years. And Miami’s airport ranks third in the US for cargo volumes with 1.8 million tons. (We need our bananas and coffee!) Factor in the port and the improvements in the works and what you’ll get is a bigger demand for warehousing space, JLL Miami office managing director Steve Medwin tells us.
Steve Medwin at the Panama Canal
Steve (here at the Panama Canal showing off a cargo ship and the car he commutes with) tells us almost all goods produced in the Caribbean or Latin America (or items from elsewhere in the world going to Latin America) come through a warehouse in Miami at some time, whether it arrives by ocean or air. The growth of their economies and a true middle class growing in Brazil and Columbia is increasing the consumer demands from computers to TVs and medical equipment. That compels the need for those 5,000 to 50k SF Miami warehouses. Eventually, there will be the need for bigger spaces, Steve says.
Miami International Airport
Miami International Airport has one of the largest annual cargo volumes only behind Chicago and Memphis, according to JLL’s third annual Port, Airport and Global Infrastructure report. Miami also ranks high on the JLL Airport Index with an average vacancy rate of 9.9%, reasonable rents at $5.83/SF, and high cargo volumes. Miami International Airport handles 83% of all imports and exports to and from Latin America and the Caribbean.
Port of Miami
Steve’s crystal ball predicts the most noticeable impact on industrial space will come with the expansion of the Panama Canal in 2014. With the new wider lane, bigger ships with more TEUs will be coming this way. Right now, the Port of Miami is being dredged to 50 feet to allow the post-Panamatic ships to come through. That will create economies of scale, attract more shipping lines, and triple through-put at the Port of Miami. (Think Amsterdam, early 17th century, with fewer silly hats.)
tunnel rendering
One Port of Miami infrastructure improvement (costing about $1.5B): a tunnel to allow trucks and containers to travel on I-95 from the port all the way to NY without a stoplight. Right now, those suppliers moving those goods have to travel through downtown streets to reach I-95 and the warehouses in the prime airport west submarket. The port also serves more than four million cruise line passengers each year, Steve says. (And we suppose every cargo ship is also a cruise ship if you add a midnight buffet.)
port dredging
The port’s on-dock rail connection is also seeing improvements. While there's on-dock rail now, the port got a TIGER grant from the federal government to repair a damaged bridge and increase the capacity of the existing rail lines, Steve tells us. The idea: put containers on rail cars and move them off the port. Between the new tunnel and 50-foot dredging and this, the port can triple its capacity from one million TEUs to three million TEUs. That will attract shippers, too. Miami is the nearest port to Panama on the East Coast, so it will also mean cost savings for Asian goods to offload here driving the need for bigger distribution centers.

Centurion Cargo groundbreaking
Less than two months ago, elected officials flocked to the Centurion Cargo groundbreaking (whoever's in the John Deere wins our "largest ceremonial shovel" contest) for the global freighter’s new $123M, 800k SF cargo center at Miami International Airport. About a week before that, Centurion expanded its services with a new South American destination with two direct flights per week from Miami to Iquitos, Peru.
Centurion Cargo rendering
Developed on 56 acres of largely abandoned and unoccupied land in the northeast sector of Miami International Airport, the new facility will provide Centurion with 400k SF of cargo space, 90 truck doors, 99k SF of office space, and more than 500k SF of exclusive ramp space for eight or nine wide-body aircraft. The facility will be subdivided: 140k SF for perishable cargo and 260k SF for general cargo. The total capacity of the facility amounts to 500,000 tons per year. Aeroterm and Bristol Group partnered with the Aerolog Group (Centurion’s parent company) to develop and fund the cargo center, slated to open later this year.

A LOOK BACK @ 2011
Viktoria Telek
South Florida’s CRE market took a promising turn in 2011 with positive absorption; vacancy rates decreasing; and institutional money pouring into acquisition opportunities, says ComReal Fort Lauderdale senior commercial broker Viktoria Telek (shown here paddleboarding). Looking at NAREIT data, she tells us the leverage ratio of listed REITs (total debt against market capitalization) as of Sept. 30 was 38%, which is significantly lower than 51% at the end of Q2 ‘08 before Lehman Brothers collapsed. Viktoria’s 2011 trivia: Use some simple math and your age will equal 111. Take the last two digits of your birth year and add your age in 2011 to it =111! Freaky.
Our New Year's resolution: break more news. Can you help by sending us yours? Email tonie@bisnow.com
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