Mom & Pop Business Struggling To Survive During Rental Boom
MIAMI BEACH (CBSMiami) – Empty buildings in high-traffic South Florida shopping areas seem to be a common sight.
“For rent” signs dot shops on Lincoln Rd. and Miracle Mile.
But don’t let the vacant storefronts fool you.
Experts say the commercial real estate business is booming in South Florida.
“Commercial is back and it’s back in a big way,” said William Holly, President of Pointe Group Advisors, a real estate asset management company.
“Rents are up,” Holly said. “The key is residential took so much of the developable land that there hasn’t been a lot of commercial real estate development. So when the markets come back, there hasn’t been a lot of space available.”
Holly says rent on Lincoln Road has jumped from $200 to more than $300 per square foot.
“I’ve seen a lot of changes in Lincoln Road especially the last year. It’s been really tough,” said Nexxt Café manager Marija Boskovic.
Recently, TiramesU and Van Dyke Café closed their doors. David’s Café II stopped serving cafecito and croquetas at its Lincoln Rd. location almost two years ago.
Boskovic said national chains are taking over, as evidenced by stores like H&M and Forever 21.
“For now they’re doing everything in order to kill the small businesses in Lincoln Road Mall,” Boskovic said.
Businesses are also vanishing from the area in and around CocoWalk, where Johnny Rockets used to draw customers.
One business owner who spoke on the condition of anonymity for fear his rent would be raised said he believes he will go out of business within the next few years.
Others, like Noel Garcia, said they’ve been lucky.
“I have the best landlord in the world,” Garcia said. He said rent at his four businesses, which include a tattoo parlor and piercing shop, have remained reasonable.
But he senses a greater change coming.
“So far as we know, they’re actually buying a lot of the properties in the Grove to do new development in the Grove,” Garcia said. “The Grove is going to be very different in the next 10 years.”
Shuttered shops fill the famed Miracle Mile in Coral Gables as well, where Holly said rents have roughly doubled to as much as $60 per square foot.
“You’re going to see a lot more national because that’s the way the markets going,” Holly said. “They’re the only ones that can afford the rents.”
Holly said more and more beach businesses will relocate to the area south of 5th Street on Miami Beach.
That’s exactly where TiramesU is heading this fall, according to its website.