Orlando’s Office Market Surges to No. 7 in National Rankings, Driven by Coworking Growth and Rising Rents

Orlando Ranks High as Office Market in New Report

Orlando has emerged as one of the top mid-sized office markets in the nation, according to a recent report. This analysis, conducted by a commercial real estate data firm, highlighted several important trends in office space across various cities in the United States.

Who Conducted the Analysis?

The report was prepared by the CommercialCafe team, a division operated by Yardi, a California-based proptech company. The team assessed the performance, development trends, and financing aspects of 100 office markets primarily within the third quarter of 2024.

What Are the Findings?

The report categorized the markets into two groups: large (over 100 million square feet) and mid-sized (under 100 million square feet). In the mid-sized sector, Orlando was placed at No. 7, with six of the top ten markets being in Florida. The report noted that Orlando has more than 73 million square feet of office space and praised the city for its growth in the coworking scene and increasing rental rates.

Key Highlights from the Report

• Orlando added over 185,000 square feet of coworking space, ranking fourth in expansion among mid-sized markets.
• The total coworking space in the area has reached 1.27 million square feet.
• The asking rent for office space in Orlando increased by 13.4% year-over-year, now averaging $27.60 per square foot.
• In the third quarter alone, Orlando added 627,866 square feet of new office space.
• The city’s vacancy rate rose by 1.6 points, now at 17.3%.

Where Does Orlando Stand Nationally?

In comparison to other Florida markets, Miami-Dade County took the top spot overall due to a significant increase in both new office space and rental rates. In this area, office rents surged by 16.3% to average $52.90 per square foot with approximately 1.95 million square feet built during the same time period.

Which Other Florida Markets Are Performing Well?

The report listed several other Florida markets in the top ten mid-sized office markets:

• West Palm Beach: Ranked No. 2
• Southwest Florida Coast: Ranked No. 8
• Tampa-St. Petersburg: Ranked No. 9
• Fort Lauderdale: Ranked No. 10

What’s Next for Orlando’s Office Market?

Despite the increasing vacancy rate, Orlando’s office market demonstrates resilience, with minimal loans maturing this year, only 0.5% of the $4.3 billion in loans issued to local office landlords. This stability may indicate a continuing evolution in Orlando’s office landscape.

Conclusion

As Orlando continues to expand its coworking spaces and sees a significant increase in asking rents, it positions itself firmly among the leading mid-sized office markets in the country. This trend highlights both the growth potential and demand for office space in the region as companies explore new environments for their operations.