Florida's Real Estate Boom: How Migrating Execs Are Changing the Game

West Palm Beach, Florida, USA - In the wake of the COVID-19 pandemic, Florida is witnessing a remarkable transformation in its commercial real estate sector. The influx of high-earning individuals—especially from New York—is reshaping cities like West Palm Beach and turning them into flourishing year-round hotspots. Jon Paul Perez, CEO of Related Group, and Nelson Stabile, founder of Integra Investments, have noted this seismic shift, which has brought tens of thousands of affluent residents and significantly increased retail demand in the area. With retail vacancies nearly nonexistent and occupancy rates soaring to record highs, it’s clear that Florida’s appeal is growing stronger.

Ken Himmel, president of Related Ross, attributes this surge in demand directly to the migration patterns of financial executives and tech leaders since the pandemic began. Palm Beach County has gained nearly 90,000 new residents in recent years, altering its identity from a seasonal resort town to a vibrant, bustling city. A combination of Florida’s thriving economy, increasing population, and attractive tax landscape makes commercial real estate investments an appealing prospect.

A Retail Renaissance

Retail developments are blooming across Florida, particularly at CityPlace in West Palm Beach, which is undergoing a significant expansion of over 125,000 square feet. Brands like Equinox, Alo, Reformation, Bluemercury, and Crate & Barrel are set to join this lively retail environment. This integrated mixed-use development is not only meeting growing consumer demand but also fostering foot traffic, maintaining impressively low vacancy rates below 3%. As noted by Kelly Lyles of KL International Realty, the trend of retailers relocating to Florida is gaining momentum, with notable moves like Foot Locker’s expansion to St. Petersburg and Publix planning a 50,000 square-foot supermarket in Panama City Beach.

The favorable tax conditions and a lower cost of living are significant motivators, attracting both consumers and retailers alike. The rallying point for many is Florida’s business-friendly policies, which have drawn over 300 companies to relocate to the state since 2020. The allure of no state income tax cannot be overstated, and the migration of businesses and wealthy individuals has further ignited the demand for commercial properties across multiple sectors.

Five Years of Change

Florida’s commercial real estate market has undergone a dramatic evolution over the last five years, primarily driven by a post-pandemic recovery and an influx of new residents. According to insights from TVG Strategy, the state’s population has been growing at approximately 2.1% annually, with major cities like Miami, Orlando, Tampa, and Jacksonville leading this growth trend.

• Population Growth & Migration: The state’s attractive living conditions have lured high-net-worth individuals and businesses alike.
• Surge of Industrial Real Estate: The pandemic spurred an e-commerce boom, pushing demand for industrial space, especially in central Florida.
• Office Space Evolution: As companies adapt to hybrid work models, there’s a noticeable shift toward co-working spaces, while Class A offices remain in demand.
• Retail Recovery: Experiential retail is on the rise, with mixed-use developments gaining popularity as businesses recover from pandemic-induced challenges.
• Real Estate Investment Boom: Florida is attracting both domestic and international investors, with property values and rental rates on the upswing.

Looking ahead, the future of Florida’s commercial real estate market seems bright. The integration of flexibility, sustainability, and technological adaptation is poised to shape the next wave of developments, ensuring that Florida continues to appeal to new residents and investors alike.

As we watch this transformation unfold, there’s something to be said for how far Florida has come, and the potential it holds. The changes in the commercial real estate landscape echo a larger narrative of resilience and reinvention in the face of change.