A1R Water Inks 112,000-Square-Foot Lease in Hialeah as Miami Industrial Rents Rise 8.5%
A1R Water has signed a 10-year lease for 112,000 square feet of industrial space at Building 30 in Countryline Corporate Park in Hialeah, Fla. This marks a relocation of the sustainable water company’s global headquarters from Abu Dhabi to what will now serve as its U.S. production base. The 205,000-square-foot Building 30 sits inside one of Miami’s prime logistics corridors at 4341 W. 108th St. near SR 826 and the Miami International Airport freight district.
The lease, which will commence in May of next year following tenant improvements, will run for roughly 10 years through October 2036.
At the same time, an unnamed international freight-forwarding firm also signed for 61,000 square feet in a lease that will run from March of next year until 2031. Notably, both deals came about when the entire building became available as the previous sole tenant had to terminate its lease on the back of a bankruptcy that was filed on the last day of October. Together, the new leases mean that the property quickly backfilled and now sits at around 85% occupancy.
For landlord Terreno Realty Corp., a real estate investment trust based in San Francisco, it’s a quick turnaround and speaks to the demand for space in that area — and specifically inside the 120-acre, master-planned Countryline Corporate Park, where Terreno owns more than one building.
While the new leases are in Building 30 (part of the park’s Phase 3), Terreno is also the developer of the adjacent Phase 4 project, which is still under construction. Once completed, it will include 10 buildings totaling roughly 2.2 million square feet of industrial space. Phase 4 also includes Terreno-owned Building 33, which earlier this year reached 100% occupancy. Taken together, Phases 3 and 4 are expected to total 17 buildings and 3.5 million square feet. In the Miami metro area alone, Terreno owns around 40 industrial properties totaling nearly 4.7 million square feet.
Incoming tenant A1R Water is an innovative water systems firm that specializes in transforming air into water. The new facility in Miami will pull together research, assembly and logistics all under the one roof as the company expands into America, following its Nasdaq listing earlier this year. The move is expected to create around 70 to 90 new jobs. Currently, the company has a roster of clients that include thew Hilton and Fairmont hotels, as well as the Miami Heat basketball team.
Miami Industrial Market Snapshot
Miami posted one of the fastest industrial real estate rent gains among major markets after rising 8.5% year-over-year. That ties it with Atlanta in rent growth and lands just below leader Philadelphia (8.7% growth), per Yardi Research data through September. Additionally, new leases for industrial space in Miami are roughly $3.80 per square higher, on average, that in-place rents. The lease spread amounts to new leases commanding $16.88 versus in-place rents of $13.08.
Despite the new lease premiums, the vacancy rate for industrial space has ticked up around 630 basis points year-over-year to 11.1%, which is above the national average of 9.5%.