How has the pandemic impacted the market’s favorability towards tenants and retaining them?

Absolutely. There are a couple of significant factors at play here, especially looking ahead over the next 12 to 24 months. First, there’s a considerable influx of new supply being delivered, characterized by a high cost per square foot and elevated rental rates. However, this comes at a challenging juncture when many businesses are contemplating downsizing and are not keen on investing significantly in premium Downtown spaces. In the short term, there’s a prevalent focus on expense reduction, leading to a notable surge in subleased space. Many companies are actively putting their offices on the market, exploring subleasing options. With this influx of subleased spaces and new developments, the market dynamics strongly indicate a tenant-favorable environment, at least from the perspective of the office market.

How has the industrial space sector performed in the region amid these shifts?

Tampa’s industrial market is intricately tied to the region’s ongoing population growth, which has notably outpaced many other areas in the country. Particularly, people are flocking here from states like New York and California, viewing Florida as a prime destination. This migration surge stems from various factors, including weather, political climate, tax benefits, and the overall environment, all favoring Florida. We’ve seen this reflected in the robustness of the single-family housing market during the pandemic. Florida is leading as the top destination for one-way trips, a trend that’s expected to persist and significantly contribute to the Gross Regional Product (GRP) and overall activity in the region.

Now, let’s consider the buying patterns and preferences. The shift toward convenience in purchasing behavior is an undeniable global trend. People increasingly prefer having items delivered to their doorsteps cost-effectively rather than visiting crowded stores and waiting in lines. This paradigm shift has stimulated the demand for industrial spaces, especially those catering to last-mile deliveries. The current industrial market is already struggling to meet the demands of the existing population, let alone accommodate the projected growth. Consequently, there’s been a fervent push to construct new or renovate existing last-mile industrial spaces. Alongside multifamily housing, industrial properties have emerged as the most resilient and high-performing assets during the pandemic. The pandemic has essentially driven the surge in the industrial market.

In my opinion, considering the United States’ standing globally, the Southeast region within the U.S., particularly the 1-4 corridor, could arguably be deemed one of the most promising investment corridors worldwide.