Fort Lauderdale becomes a shopping haven. What’s driving the city’s thriving retail scene?

Downtown Fort Lauderdale’s shopping and restaurant scene is in full bloom, boasting its lowest retail real estate vacancy rate in 10 years.

It’s a sign business owners are placing confident bets on South Florida tourism and the state’s population growth, real estate experts said.

Of the city’s 612,000 square feet of retail space along Las Olas Boulevard and Federal Highway, only 18,972 square feet, or 3.1%, remains unleased, according to data from the Las Olas Association, CoStar Group and the quarterly Colliers 2023 Downtown Fort Lauderdale retail market report.

Over the last decade, the city’s urban center has recorded retail vacancy rates as high as 9.8% in 2013, and a prior low of 5.5% in 2022.

Fort Lauderdale’s robust shopping, eating and drinking options reflect a city and downtown undergoing a renaissance in recent years. According to the U.S. Census Bureau’s American Community Survey, the city has a population of 181,666 residents, up from 172,374 in 2013. Following the city’s growing population, new neighborhoods have emerged in pockets of the downtown core. Developers are flocking to add new retail and residences to the city.

“South Florida and Florida are having a good couple of years,” said Juan Arias, director of market analytics for CoStar Group, a commercial real estate data firm. “Fort Lauderdale is benefiting from the increasing [home] buyers. You have international tourism and continued migration from New York and California. That overall benefits the purchasing power.”

Taylor Fuentes, owner of Ann’s Florist & Coffee Bar, opened along Las Olas in 1992. Her grandmother launched the business in 1976 in Hollywood, then moved it to its current site where it’s a neighborhood staple for flower arrangements, home decor and — as of 2017 — a coffee shop.

“I love new business. If they work out, that’s more people coming to the street and more business for everyone,” Fuentes said.

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The stronger attraction to downtown Fort Lauderdale benefits local businesses, Fuentes said, but it also brings challenges. Likely at the top of that list is commercial landlords have doubled rents downtown since 2013, from an average of $29.89 a square foot to $60 at the end of last year.

In recent years, the city’s downtown retail rent increase ranked as one of the highest in the country. From June 2022 to this month, average rent for jumped by about 10%. That’s the second highest rent jump for a retail market in the country, following Jacksonville, which saw a 12% jump, Arias said.

Charlie Ladd, owner of Barron Leasing Co. and a board member of the Fort Lauderdale Downtown Development Authority, keeps pushing for more commercial activity in downtown Fort Lauderdale.

“We’re still being discovered,” Ladd said. “We’re still the little brother (compared to Miami) that’s growing fast. We need to continue to bring restaurants and retailers people want to go to.”