February 23, 2015, By Andrea Vigil
In the last year, Wynwood has seen an influx of new tenants and escalating rental rates as demand for space in Miami’s urban, hipster heaven continues to increase. Newly redeveloped space in prime locations such as NW 2nd Avenue are achieving rents of $45 PSF NNN and up, with national and international brands such as Italia Independent and Aesop signing leases in 2014 at Wynwood Block at 2621 NW 2nd Avenue.
Commercial landowners, working with the Wynwood Business Improvement District, have spearheaded efforts to drive development. This includes initiatives like hiring extra security, clean-up crews, and painting crosswalks to foster an increasingly pedestrian friendly environment. These actions, coupled with a burgeoning tech scene fostered by co-working spaces, monthly art walks highlighting the graffiti art on many of the buildings, new glass store fronts on many of the district’s warehouses, have turned Wynwood into an exciting and eclectic retail destination.
Retail occupancy rates for the main commercial area from NW 20th Street so NW 29th Street are currently at 92%.
ASKING RENTAL RATES
NW 2nd Ave: $50 PSF/NNN and up
Wynwood Walls: $55 PSF/NNN and up
North Miami Ave: $45 PSF/NNN
Rising rents have sent some of the neighborhood’s older tenants – galleries and wholesalers – out of the market. Local apparel operators and restaurants, however, feel that the market provides access to millennials and upwardly mobile thirty somethings who appreciate the urban lifestyle.
Long-time Miami Beach men’s wear tenant, Basico, turned a pop-up location during Art Basel into a permanent home at 2347 NW 2nd Avenue. Additionally, two local bakery favorites, Zak the Baker and Fireman Derek’s Pies, both made brick and mortar debuts in Wynwood.
Wynwood’s industrial zoning has provides one of the few areas in Miami for breweries to enter the market, along with craft beer-centered concepts. The largest is Concrete Beach Breweryat 325 NW 24th Street, just west of NW 2nd Avenue, as well as J. Wakefield, Boxelder andWynwood Brewing Company.
Canadian fast-casual chain, Freshii, recently opened at 2300 NW 2 Avenue. The increased retail environment has made Wynwood a hotspot for capital deployment by a variety of funds.
ACQUISITIONS HEATING UP
The Wynwood Central development site was acquired by East End Capital for $23.5 million in October 2014. East End Capital made other purchases along North Miami Avenue, and have reportedly assembled more than 1 million square feet in development rights.
KAR Properties purchased the Mega Shoes Warehouse at 2050 N Miami Avenue for $12.5 million in December 2014. This was the firm’s fifth acquisition in South Florida.
More recently RedSky Capital and London-based JZ Capital Management purchased a gallery at 2407 NW 2nd Avenue, across the street fromPanther Coffee, for $10.6 million. The transaction was recorded in January 2015 and represents a price of $770 PSF for the land.
This month, East End Capital’s Wynwood Arcade, a 20,000-square-foot retail and restaurant development at 74 NW 24th St. began leasing spaces at $50 PSF/NNN. The project is adjacent to Panther Coffee and is expected to be delivered Q3 2015.
MIXED-USE DEVELOPMENT PIPELINE
250 Wynwood, an 11-unit boutique condominium, is the first residential project in Wynwood since 2008. Already topped off, the development’s estimated delivery is in the second quarter of 2015.
A mixed-use project by Bazbaz Development went before the Urban Development Review Board this past January. The board recommended that the project, located at 2110 N Miami Avenue, be approved. It features 163 apartments, 79 hotel rooms, and +/- 12,000 of retail. The development site was approved for rezoning last year.
ADDITIONAL NEW TENANTS IN THE MARKET
Made in Italy Gourmet: Italian restaurant and market at 10 NE 27th Street
Coyo Taco: Chef inspired Mexican street food at 2300 NW 2nd Avenue
Zak the Baker: Bakery and café at 405 NW 26th Street
Basico: Menswear opened at 2347 NW 2 Avenue
JetSet Pilates: Three-unit pilates operator opened at 401 NW 26 Street
HISTORY OF WYNWOOD – AN INTERACTIVE TIMELINE
Andrea handles agency leasing and tenant assignments for national and international retailers seeking to expand their footprint in Miami. From market tours to negotiating lease and purchase agreements, Andrea tracks market information that enables retail clients to make informed, complex decisions. Andrea is a member of the International Council of Shopping Centers, Commercial Real Estate Women Network and is a licensed sales associate in Florida.