As Miami's Brickell financial district has transformed from a working neighborhood to a land of luxury condo towers has had a casualty in the form of necessary parking to accommodate the growth. This problem kind of surprised everyone.
Luxury real estate brokers and observers say that a total recovery of the bust is hindered by the absence of public parking in the area. Luxury residential development drove real estate land costs so far up that it is not affordable for the city of Miami or Miami-Dade County to buy real estate sites for public garages. Also, office tenants are putting more employees into smaller offices as a way to reduce their real estate costs. That increases the necessity for parking in Brickell office towers and also raises occupancy costs. 10 years ago, the average square foot per employee was about 250 and now it is getting down to 125 to 150 square feet per person. All that does is double the demand for parking space real estate.
Much of the office leasing activity has come from occupants moving around and renewals. while, organic growth from tenants who are not already in the financial district is sluggish. Some executives are pointing to the lack of parking as a reason not to expand into Brickell. $150-to-$200 per month for a parking space is exorbitant. According to Art Noriega, CEO of the Miami Parking Authority, the parking authority manages over 36,000 parking spaces in the city, with 14 garages, 86 surface lots and 11,300 on-street spaces.
Brickell was built as a Class A office commercial real estate environment under a couple of different zoning codes over the years and the difference between downtown Miami and Brickell is that much of the municipal parking was built in the downtown core to supplement luxury buildings with little or no parking. Then, as new luxury buildings were built, a lot of the office and commercial users have needed a lot more parking real estate. Very car friendly public parking policies have impacted the financial district.
Owners of older office towers in the financial district now have a favorable option for companies that need more parking, like the 28-year-old Brickell Bay Office Tower at 1001 Brickell Bay Drive can offer parking ratios of three spaces per 1,000 square feet and newer buildings can only provide one or two per 1,000 square feet.
Those who are in favor of additional Brickell parking point to Miami Beach as an example of a city that has sufficient parking inventory for its office buildings and luxury towers.
The nearly 1,500-space 17th Street public garage next to the Miami Beach Convention Center is an inexpensive place to park near Lincoln Road. Also, the city has used public-private partnerships, like The Lincoln one block north of Lincoln Road. The Lincoln has six levels of public parking and 160,000 square feet of office and retail space.
The city of Miami Beach has been proactive about their parking than Brickell. With the luxury real estate expansion of luxury condo towers, something needs to get done.
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Andres Leiser is a local contributor for Constec Realty's Miami luxury real estate website. Andres Leiser has been involved in Miami real estate for over a decade. For more information please visit www.constecrealty.com
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