What Are Office Tenants Looking for in South Florida?

AJ Mueller, Co-Founder, ORIGIN Construction. Image courtesy of ORIGIN Construction

South Florida’s office market has recently undergone major changes, fueled by a mass migration of businesses to the area, mainly from West, Northeast and Midwest metros. Companies seek office expansions or relocations to the South Florida area due to the state’s lower cost of doing business, the favorable tax environment, and the accessibility to Latin America and other international markets that the region offers.

South Florida’s lifestyle is another draw for numerous businesses, according to AJ Mueller, co-founder of Miami-based ORIGIN Construction, a company that currently has more than 35 projects underway across South and Central Florida. In the interview below, Mueller reveals what office tenants are looking for and provides an overview of South Florida’s office sector.

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How have companies’ real estate needs evolved since the onset of the pandemic?

Mueller: Since the onset of the pandemic, we’ve seen clients put increased focus on optimization of their office spaces. At ORIGIN Construction, we’ve had to work closely with many of the companies we represent to identify the most efficient ways of laying out their spaces to give employees enough room without having to restructure existing leases or take on additional office space.

To what extent has the pandemic changed the way companies operate? 

Mueller: During the peak of the pandemic, ORIGIN was getting more requests from companies seeking to make modifications to their office spaces to accommodate a rotation of employees, with some working from the offices, while others worked from home. Now that the vaccination rollout has advanced and the number of COVID-19 cases has steadily declined, we’re seeing a slowdown in those types of requests.

What are the most sought-after amenities corporate tenants are seeking?

701 Brickell

Mueller: Today, the most sought-after amenity we find is wellness. Businesses of all sizes are prioritizing wellness when they design and build their office spaces. This is a trend we’re not only seeing companies adopt for their spaces but trophy office towers are embracing it as well.

For example, we’re working with the premier office tower 701 Brickell on a renovation and our project team is building a state-of-the-art fitness center with specialized equipment and workout areas. The space itself will be prominently situated in the lobby level of the building, easily accessible to tenants.

Additionally, companies are adding open, communal spaces—such as lounges and cafes—that are centrally located within the office space with a creative design, comfortable seating and tables. This represents a significant shift from the secluded breakrooms located in corner locations that you would traditionally see in office spaces.

How disruptive has the pandemic been for your projects?

Mueller: As a builder, ORIGIN is very active right now with some very exciting projects we have underway across the state. The construction industry as a whole in the region has seen an increase in activity, with many projects getting off the ground. This is contributing to some challenges for the industry: Primarily, the disruption to the supply chain at a global level is impacting access to some construction materials. Secondly, the access to labor, given that the nation experienced a reduction in workforce during the pandemic.

Are there any other challenges that you need to overcome in the construction industry nowadays?

Mueller: In addition to the challenges created by the labor shortage and supply chain delays, the other challenge the construction industry is navigating is securing building permits to begin a project. The building permit departments of local cities are experiencing a wave of new development activity. As a company, we are working closely with these departments to help get permits issued in an expeditious manner.

Many of your projects are headquarter buildings and major regional offices. Tell us more about the largest of these developments and the story behind it.

Southeast Financial Center. Image via Google Street View

Mueller: ORIGIN recently completed building out a 111,000-square-foot, five-floor office space for Morgan Stanley at Southeast Financial Center in downtown Miami. Our project team spearheaded the buildout of the firm’s newest flagship office during the pandemic. The space was delivered this summer.

Where exactly in South Florida is development activity concentrated and why?

Mueller: Right now, the ORIGIN Construction team is seeing a boom in all the major urban cores within the tri-county area, from Miami’s urban core to Fort Lauderdale and West Palm Beach’s central business districts. Additionally, many emerging and established neighborhoods are also seeing a wave of mixed-use development such as Wynwood, Coconut Grove, Coral Gables and Miami Beach.

In fact, ORIGIN has already secured more than $210 million in contracted construction work year-to-date, comprising over 1.4 million square feet of commercial space. The company has also delivered between 2020 and today projects such as the new offices for law firm Carlton Fields in downtown Miami, Kaufman Rossin’s new headquarters in Coconut Grove, City National Bank’s new banking center and office space in downtown Orlando, Dania Dermatology’s newest medical office and Haiku’s Private Restaurant Experience in the Wynwood Arts District.

How do you see South Florida’s office market going forward?

Mueller: We don’t see any signs of the office market in South Florida slowing down, particularly with new office buildings such as 830 Brickell signing office tenants that won’t even start buildout until next year. In our conversations with architects, developers and real estate brokers, the shared sentiment is that this level of deal and development activity will continue in the foreseeable future.