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2018-2019 AT THE EDITION CENTER OF WHAT’S NEXTFOR MIAMI RETAIL Major Markets Report AT THE CENTER OF WHAT’S NEXT 2 MIAMI RETAIL MAJOR MARKETS REPORT TABLE OF CONTENTS Click number to jump to section RETAIL IN MIAMI-DADE CONNECTING THE OLD WITH THE NEW RETAIL IN MIAMI-DADE CONNECTING THE OLD WITH THE NEW Miami-Dade Population Projection 3400.00 435,000 new residents by 2030 3200.00 3000.00 2800.00 2600.00 In Thousands 2400.00 2200.00 2000.00 2000 2005 2010 2015 2020 2025 2030 Reinvention is the 2018 theme for Miami-Dade. Like an oversized impact on the region, nationally and many gateway cities, the makeup and composition worldwide. It is the fourth largest urban area in the of its diverse population are constantly shifting United States with 5.5 million people. This dense and creating new influences that impact people’s market, which averages more than 4,400 people taste and style. The diverse demographic profile of per square mile, makes it an ideal testing ground for people who live, work and visit the area creates an new retail experiments that may eventually roll out ideal environment for the confluence of wealth and to other markets. consumer spending that supports a vibrant retail Miami-Dade is not one market but many separate market. neighborhoods, each with their own unique flavor. Miami-Dade is not immune to the challenges that The 34 cities and numerous unincorporated areas traditional retail is experiencing nationally in today’s are predominantly Latino. Of that total population market. The fast pace of change is leaving some in the county, 70 percent identifies as Hispanic – but retailers and older shopping areas struggling to find within that community are significant pockets of ways to attract customers and increase foot traffic. Cubans, Puerto Ricans, Dominicans and Mexicans, The digital infrastructure and the curated experiential as well as residents from most Central and South environments are creating new touchpoints American countries. Each ethnic group creates an with customers that are more intertwined and evolving cultural identity that influences how people interconnected. Miami-Dade’s retail submarkets are live and shop. at the forefront of the changing landscape of how we shop. South Florida in 2018 is a microcosm of how these changes are affecting the old retail model and of 70% how retailers are confronting the new subtleties in of the total population in the the 21st century. Due to its size, Miami-Dade has county identifies as Hispanic. 6 MIAMI RETAIL MAJOR MARKETS REPORT 2018-2019 EDITION 7 MARKET DYNAMICS IN MIAMI-DADE MARKET DYNAMICS IN MIAMI-DADE Vibrant Tourist & Hospitality Sectors A Record 15.9 million In 2018, Miami-Dade remains one of the top choices for overnight travelers visited in domestic and international travelers. A record 15.9 million overnight travelers visited in 2017 and that number is 2017 and that number is expected to be even higher in 2018. Visitors spent more than expected to be even higher in $26 billion in retail expenditure in 2017. Retailers in high- traffic tourist areas are guided by the international stream 2018. Visitors spent more of customers directly influences how retail formats are than in retail developed and how they respond to changes in customer $26 billion profiles. As the number and origin of visitors shift, those expenditures in 2017. factors also force many retailers to reinvent and reimagine their spaces to differentiate themselves in a competitive environment. PortMiami is the cruise capital of the world and wants to ensure it keeps that title. In the last three years, the port has signed lease agreements with three major cruise lines for new terminals, including Royal Caribbean, Norwegian and MSC cruise lines. The new facilities, which will be completed in 2018, 2019 and 2022, respectively, will be able to accommodate each line’s largest ships, called World Class vessels, each of which can carry nearly 7,000 passengers. Currently those size ships dock at Port Everglades, to the north in Broward County. Miami is the No. 1 cruise port in the world. Source: Miami Downtown Development Authority, 2018 10 MIAMI RETAIL MAJOR MARKETS REPORT ORIGINS OF TRAVEL DOMESTIC INTERNATIONAL 51.2% 48.8% Number of Domestic Visitors Number of International Visitors 7.8 Million 8.1 Million HOTEL ROOMS GROWTH IN CRUISE 55,453 PORT ACTIVITY PASSENGERS UP 10.9% OCCUPANCY Number of Cruise 76.7% Passengers 5.3 Million AVERAGE DAILY ROOM RATE/NIGHT $190 ECONOMIC IMPACT $34 BILLION DIRECT/INDIRECT EMPLOYMENT 320,000 MIAMI ARRIVALS AT MIA CRUISE SHIPS 22 44.1 MILLION CRUISE 55 LINES MIAMI AIRLINE CARRIERS 106 2018-2019 EDITION 11 MARKET DYNAMICS IN MIAMI-DADE 12 MIAMI RETAIL MAJOR MARKETS REPORT The Miami Beach Convention Center (MBCC) Miami Beach sees more than 600,000 visitors annually Convention Center and is in the final stages of a $620 million Convention center business plays an renovation and expansion. With a new important part in bolstering consumer facade, 505,000 square feet of exhibition spending and adding to the market’s total space with 10 additional meeting rooms and retail sales. In 2017, 3.6% of all business 870 new parking spaces, MBCC seeks to travelers to Miami-Dade came to attend attract larger conventions while reengaging events at convention centers. Most of these with the surrounding community. attendees stay in hotels in Miami Beach, a world-renowned destination famous for its nightlife, restaurants and shopping. $620 Million 870 New Renovation & Expansion Parking Spaces 600,000 Visitors Annually 505,000 SF 10 of Exhibition Space Additional Meeting Rooms Source: Greater Miami Convention & Visitor Bureau, 2018 2018-2019 EDITION 13 MARKET DYNAMICS IN MIAMI-DADE buy homes and park money in real estate Visitor Impact and assets, with most willing to pay all cash Shadow Market for assets. The Shadow Market includes many international residents, primarily Tourist numbers include short-term from Latin America, and remains one visitors as well as many who have of the main factors behind the region’s purchased homes in the region and strong real estate market and elevated stay for extended periods of time, retail sales growth. from a few weeks to several months. These temporary residents use South Florida as their second or third home On average, 62% of and participate in the “Shadow Market,” which is not easily quantified in foreign buyers demographics or spending statistics, and spend more than is not included in the Census. However, temporary residents do contribute and twice that of domestic drive the economic vitality of the region buyers on residential and come from all over the world. Many properties in Miami. Retail Sales in Billions vs. Household Income $60B $50K $50B $45K $40B $30B $40K In Billions $20B $35K $10B $0B 30K 2000 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 ‘14 ‘15 ‘16 ‘17 Retail Sales Household Income Sources: Moody’s , 2018 14 MIAMI RETAIL MAJOR MARKETS REPORT 2018-2019 EDITION 15 MARKET DYNAMICS IN MIAMI-DADE Eclectic Density & Neighborhoods & Verticalization Communities Most of South Florida, including Miami- Dade, is boxed in between the Atlantic Miami-Dade is not one retail market but Ocean and the Everglades. While a fractured region made up of distinct these enclose and define the natural geographic retail clusters that many boundaries of the market, they also allow times overlap and are interconnected by for the densification of neighborhoods transportation corridors. The strength of and clustering of business and retail the retail market lies in its diversity and services. Two outcomes that benefit the ability to cater to any customer’s needs retail sector are: or wants. From High Street retail to local convenience, several neighborhoods 1. Vertical development along major traffic have a stricking juxtaposition of corridors 2. Forcing the adaptive re-use of existing different uses that can help draw structures into higher value uses customers in, creating foot traffic. The This second trend has occurred in local population as well as strong tourist semi-industrial areas surrounding the inflows reenergize the retail market with downtown core. It has added pressure new concepts and ideas. on local infrastructure and increased The unique layout of the retail market traffic congestion as residents migrated in Miami-Dade also makes it difficult for from the western suburbs east to a few big retail players to dominate the the urban core. Given the inability to market. As in many other gateway cities, grow outward, the movement east is retail in Miami-Dade has been protected creating additional incentive for vertical by its size and diversity from changes in development and will continue to the overall retail landscape. provide new opportunities for retailers. The local population as well as strong tourist inflows reenergize the retail market with new concepts and ideas. 16 MIAMI RETAIL MAJOR MARKETS REPORT 2018-2019 EDITION 17 HALLANDALE BEACH BLVD E MIRAMAR PKWY E E 95 BROWARD COUNTY K I NW 215 ST 99 P MIAMI-DADE COUNTY NW 211 ST N R 95 U TO FORT TO LAUDERDALE NE 207 ST T D NE 205 ST GOLDEN S E NW 206 ST 297 ’ R BEACH NW 2 AVE NE 203 ST NE 2 AVE Y The Bus Terminal A RED ROAD 27 27 IR AVE NE 12 D A at Aventura Mall NW 202 ST I IVES D R FLAMINGO RD FLAMINGO NW 199 ST O 99 3,9 WI LLIAM LEHMAN CSWY 199 ST99 L M IAMI GARDENS F 17 95 E,S MARKET DYNAMICS 183 210 NE 192 ST 99,183 NW 52 AVE NW 52 NW 191 ST NW 47 AVE NW 47 NW 191 ST 95 99 MIAM 75 NE 186 ST NW 186 ST I GA 32 93, 95, 120 RDENS DR AV E AV E NW 183 ST MIAMI GARDENS

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