Florida Market Update: August 2026
By Ben Blanton – V.P. of Originations
Florida’s commercial real estate market moved through an unusual stretch this summer. Miami played host to seven FIFA World Cup matches at Hard Rock Stadium, including the third-place match in mid-July, providing a short-term hospitality catalyst against a backdrop of longer-running structural trends and a still-undecided rate environment. Below is where fundamentals and financing stand heading into August.
Fundamentals
Multi-family remains the most metro-dependent sector in the state. Miami posted the lowest vacancy among the major South Florida markets at 6.6%, with rents up 0.7% year-over-year — the strongest combination of occupancy and rent growth in the South region. Orlando and Tampa are further into the supply cycle, with concessions common and effective rent growth negative in several submarkets. The silver lining is the projected 1.6% inventory growth in both Miami and Fort Lauderdale in 2026, the slowest pace in a decade, which should support tightening into 2027 as deliveries fall to a multi-year low.
Industrial is still absorbing new inventory from recent years. Miami vacancy is running roughly 7.0–7.2% depending on the source, with rents holding close to peak levels at $16.42–$17.26 NNN, and Doral Class A space commanding $18–$20. Jacksonville’s vacancy is meaningfully higher, in the 10–11% range, but with a limited construction pipeline: only 901,000 square feet are currently under construction, down nearly 70% from a year ago. Another continuing trend is small-bay product under 150,000 SF continues to command a significant rent premium over bulk distribution space.
Retail continues to be the state’s strongest fundamentals story. Orlando leads the major metros with vacancy sitting near 3.9%. Grocery-anchored centers are trading at cap rates in the mid-5% range, with unanchored strips wider. National retail construction is expected to fall sharply this year, which should keep Florida’s already-tight numbers tight.
Office has outperformed expectations. Miami now commands the highest average office asking rent of any U.S. metro (ahead of Manhattan on a citywide basis) and Brickell Tier I space is commanding well over $130 PSF. Miami/South Florida leads the country in same-asset office rent growth at 4.0% year-over-year, with Orlando second nationally at 3.0%.
Financing
The Fed held its target range at 3.50–3.75% through the June meeting, which was the first meeting under new Chair Kevin Warsh. Recent news shows approximately half of policymakers on record supporting a hike later this year if inflation doesn’t cooperate. That sentiment is vastly different than what the market was pricing at the start of 2026, when several cuts were still the base case. Borrowers underwriting new debt or refinancing maturing loans should be planning around a higher-for-longer base case and not a cut scenario.
That rate uncertainty is showing up directly in execution timelines. CMBS conduit execution has stretched beyond typical timelines in the current environment, up from where it was running a year ago, as spreads have widened, and rate volatility has made pricing harder to lock down late in the process. For borrowers on a tight closing timeline (particularly anyone facing a 2026 maturity) that timeline risk is a real concern.
Life company capital has been the more stable counter-cyclical source through this stretch. Allocations are up from last year, and spreads on premium, low-leverage product have tightened to the low-100s. The rate-lock-at-application mechanic that comes with life company execution removes the exposure to a Fed decision landing mid-process, which is exactly the risk CMBS borrowers are currently carrying. For stabilized, income-producing assets (multi-family, industrial, retail, and increasingly office in the right submarkets), the certainty of execution is worth more today than it was six months ago.
