JLL launches new division for small warehouses in Dade

Demand is rising for small industrial spaces in South Florida. So much so that one team launched a small-bay division — the warehouse industry’s term for smaller units — in late January to meet clients’ requests.

The commercial real estate firm JLL, which is headquartered in Chicago, opened a new division in South Florida for leasing and managing warehouse space between 2,500 and 10,000 square feet, according to JLL’s South Florida industrial lead, Brian Smith.

With demand high and supply limited, the leases are 20-30% higher per square foot than large dry warehouses, Smith said. A dry warehouse ranges from $7 to $9 per square foot in South Florida, according to CBRE.

With a presence nationwide and in 80 countries, it is the first time the company has launched a smallbay division. It will hire up to three more propertymanagement employees in the next six months to oversee leasing, management, and new construction in South Florida.

JLL feels confident in establishing a dedicated staff for small bays now that the users are expanding to include institutional players and property managers, including Brookfield and Blackstone, Smith said.

Of the 11 million square feet that the company leases, JLL oversees 1.7 million square feet for small-bay, multi-tenant properties in Doral, Medley, Miami Gardens, and Hialeah, Smith said. It aims to lease from three to five million more square feet in the next few years.

“There’s a tremendous amount of product in South

Florida,” said Tim Rivers, JLL Florida market director. “We intend to bring this division to other markets across the state, but South Florida is the perfect place to start.”

Small-bay, multi-tenant properties are defined by slightly different characteristics than dry industrial spaces and cold storage. The users need 18- to 20foot ceilings, one or two docked doors — vertical sliding doors at the loading docks — and a small office space. That’s compared to dry warehouses, which offer 30-foot ceilings and multiple docked doors.

Distribution companies are the most common users, Smith said. Companies distributing a various products — think outdoor furniture, sleep apnea CPAP masks, car parts, photo supplies, hot tubs — require these spaces.

Population growth and tourism are driving interest for small-bay centers, Smith said: “Those two things are big drivers for the small-bay business in South Florida because hotels have people that supply uniforms, they have people who supply restaurant supplies, they have people who are supplying meat and produce. It is a trickle-down effect with hospitality and tourism growing as well as population growth.”

More industrial space is in the pipeline for South Florida. Tourism, especially activity in PortMiami and Port Everglades, population growth, and trade with

Latin America are fueling demand.