In Palm Beach, sun-soaked days are not a luxury; they are the norm. Everything you imagine about paradise is here—small-town charm with world-class amenities, an idyllic coastal lifestyle, and a strong community spirit that fosters a mutual passion for the ocean.
It’s no wonder that luxury real estate in Palm Beach, Florida continues to soar. While its listings increased by over 30% from a year ago, the county’s inventory has also seen a 37.5% increase, reflecting a strong desire to cater to the growing demand for properties in the area.
But investment options are not limited to waterfront homes for sale in Palm Beach, Florida. The area also teems with rentals, as well as commercial and industrial real estate options that offer attractive business opportunities. These include high returns, stable cash flows, solid appreciation potential, and property flexibility, to name a few.
If you want to diversify your portfolio through Palm Beach real estate investments, let us walk you through everything you need to know about the market.
Table of Contents:
Why It Pays to Invest in the Palm Beach Real Estate Market
Ranked 36th in the country’s top retirement destinations, Palm Beach gets an excellent rating in livability because of its high employment rate, wide variety of outdoor activities, pleasant weather, nightlife, and health and fitness opportunities. Due to its ease of commute, low crime rate, and proximity to top-notch schools, it’s also a premium relocation choice for families.
All these favorable factors result in a vibrant real estate market—a haven for investors looking for reliability, manageable risk, and strong profit. Here are more reasons to sink money into Palm Beach real estate investments.
Stable economy
Palm Beach has a diverse economy with robust industries in healthcare, finance, and technology. Moreover, its secure job market steadily attracts a skilled workforce. In fact, West Palm Beach alone is boosting employment growth in South Florida, enabling it to surpass the national rate. This ensures a consistent demand for commercial and industrial spaces in the area.
Tourism and hospitality
Palm Beach is a major tourist destination, enticing millions of visitors every year. The county received a record-breaking 9.5 million visitors in 2023—a 2.5% increase from the previous year. High tourism rates drive the commercial real estate market. Hotels, malls, recreation facilities, restaurants, and entertainment venues thrive in such an environment.
Wealthy population
In Palm Beach, the median household income is over $76,000, which is higher than the national average. The figure indicates a 10.4% growth in just one year, reflecting the steady increase in the population’s revenue. Because an affluent demographic translates to higher disposable income, Palm Beach residents afford to spend on luxury goods and services.
Excellent quality of life
Waterfront homes for sale in Palm Beach, Florida provide the unique experience of being both living spaces and perpetual getaways. For residents, every day feels like a vacation in a paradise-like location. Such a desirable living environment attracts professionals and businesses, boosting the need for commercial and industrial real estate.
Ideal location
Palm Beach enjoys a strategic location, with easy access to major transportation routes, including airports, highways, and ports. Each year, the Palm Beach International Airport caters to six million passengers and conveys 19,000 tons of cargo. Meanwhile, the Port of Palm Beach sends and receives over 2.5 million tons of cargo annually. This active trade opens up business opportunities for industrial warehouses.
Business-friendly environment
Florida does not impose a state property tax. County governments exclusively impose property taxes, which make up the bulk of their respective budgets. With an average annual property tax rate of 0.86% for homeowners, the Sunshine State ranks 25th lowest in property tax rates across the nation. Moreover, local governments in Palm Beach often provide favorable regulatory measures through incentives and support for business investment and development.
Ongoing development
Palm Springs constantly holds opportunities for development, such as planned infrastructure and new construction in expanded areas, enhancing the area’s desirability and accessibility. Investors stand to benefit from new developments, urban renewal projects, and expanding commercial districts.
Current State of the Palm Beach Real Estate Market
Market overview
The US office market faces a high vacancy rate due to the nationwide trend of increased remote work. As a result, companies have adjusted their office spaces, mostly downsizing them.
However, this doesn’t mean that offices will be outdated. Modernized office spaces in desirable locations still attract tenants looking for upscale environments. Proof of this is the outlook for Palm Beach commercial real estate which remains positive this year.
New deals in the office sector totaled over 200,000 square feet, which has been a steady figure in the past nine months. This indicates an active market with normal leasing activity.
Boca Raton, in particular, is doing increasingly well in the office market, comprising 46.5% of the latest leases this year. Its most significant tenants are renewable energy producer MN8 Energy and home furnishing company Twin Star Home, amounting to a combined 38,301 square feet.
Meanwhile, rent prices continue to rise in Palm Beach due to an influx of supply and rising construction expenses. The county’s overall rental cost is at $46.29 per square foot, up 3.6% from last year. Class A office spaces, which have high-quality aesthetics and infrastructure in superb locations, rose 1.6%. The slightly older Class B buildings’ rates climbed 4.4%. Those in the CBD classes also increased 4.4% at $64.69—a notable peak in the market.
In terms of industrial real estate, Palm Beach’s new leasing agreements reached 286,355 square feet, which is aligned with its average activity in the last six quarters. Warehouse and distribution made up over 85% of all signed deals, significantly boosting market dynamics. Net absorption was on an uptrend, totaling more than 126,000 square feet of overall occupancy gains.
Despite the market being largely balanced, a few large tenants highly influenced the net occupancy figures. The most recent major occupancies took place in 7th Avenue Logistics Center, a 76,000-square-foot industrial building designed to accommodate users needing small to medium-sized warehouse spaces.
Typical rental rates in Palm Beach’s industrial real estate increased to $14.53 per square foot, up 4.1% from last year. Wholesale and distribution reflects a similar increase of 4.2% at $14.57 per square foot. In the Riviera Beach submarket, annual rent growth was the highest, up by 34.4%, reaching $16.86 per square foot.
When it comes to rentals, demand remains strong, with more than 483,000 square feet under lease. With the construction of almost 390,000 square feet, rental rates are projected to grow due to the birth and leasing of new spaces. South Florida is experiencing an uptick in non-traditional retail clients, such as healthcare facilities, co-working establishments, and gyms, which ensure foot traffic even during non-peak hours.
Property types
Luxury real estate in Palm Beach, Florida comes top of mind when making property investments in the area. Turned into vacation rentals, these types cater to affluent tenants who desire the convenience and upscale feel of home, coupled with spectacular waterfront views and proximity to the best of what Palm Beach has to offer.
Not to be left behind is commercial real estate which is also booming in the county, offering many opportunities across different property types. In fact, foreign investments from Canada, Europe, Asia, and South America strongly influence Florida’s commercial real estate market, making it the leading US state for such investments. To know where to look for these properties with high yield potential, it makes sense to reach out to top real estate agents in Palm Beach for the best deals.
OFFICE SPACES
Palm Beach’s robust economy and business-friendly practices are favorable for office spaces. This investment potentially offers a steady income stream from long-term leases with businesses. Also, the area typically attracts professional and reputable tenants, lowering the risk of default and vacancy. But with this property type, you need to factor in maintenance and upgrade costs to stay competitive.
RETAIL
Palm Beach’s strong tourism translates to a healthy demand for retail spaces, especially in prime locations. Thanks to the disposable income of the county’s population and visitors, luxury retail stores thrive in the area. Moreover, retail spaces provide flexibility, able to combine with residential properties and offices that diversify earning potential. However, the downside is that retail tenants often have higher turnover rates than office tenants.
INDUSTRIAL
Palm Beach’s proximity to transportation hubs makes it an ideal location for industrial properties. Additionally, e-commerce growth boosts the need for warehouse and distribution centers. A significant upside of this property type is stable income from tenants who generally sign long-term leases. Industrial properties also require less maintenance than retail and office spaces.
MULTI-FAMILY RESIDENTIAL RENTALS
Waterfront homes for sale in Palm Beach, Florida are always a big hit among investors because of their luxurious allure. But all homes in this area are assured of proximity to the ocean, which is why its rental housing market enjoys consistent demand from residents and seasonal workers. Unlike single-family homes, multiple units boost potential income and lower the impact of vacancies.
HOSPITALITY
Hospitality properties like hotels and resorts benefit from the area’s high tourist traffic. What’s more, you may increase rates during peak tourist seasons. With this property, you also have the opportunity to multiply your income streams. Aside from rent, you have the chance to earn from other hospitality-related services, such as dining and event hosting. The drawback? You need to prepare for seasonal income with peaks and lows.
MIXED-USE DEVELOPMENTS
With developments that simultaneously cater to residential, commercial, and retail tenants, you can increase your potential revenue. Mixed-use properties often attract businesses and residents that value convenience, flexibility, and a vibrant community vibe. While commercial units assure residents of easy access to amenities, retail spaces also benefit from the residents’ foot traffic.
Business Incentives in Palm Beach Real Estate
Several laws and regulations in South Florida, particularly in Palm Beach, make commercial real estate investment favorable. Here are some key factors to consider.
Favorable tax policies
Florida helps keep property taxes manageable for commercial property owners through caps on annual increases and certain exemptions. If you’re a business owner, you may take advantage of the Qualified Target Industry Tax (QTI), which offers tax refunds. You may also maximize sales tax exemptions in manufacturing tools, machinery, and power consumption. All these contribute to the financial viability of long-term investments in the state.
Enterprise and opportunity zones
Specific areas in Palm Beach County have been designated as urban enterprise zones, which may qualify for tax incentives. These zones include the areas of West Palm Beach, Riviera Beach, South Bay, and Belle Glade. The county also has opportunity zones that allow investors the following incentives: deferment of payment of capital gains taxes until 2026, tax reduction of up to 15%, and the complete avoidance of capital gains taxes.
Local economic development initiatives
Palm Beach offers economic development programs through various agencies, such as the Business Development Board of Palm Beach County (BDB). These initiatives provide support, such as tax incentives, job training, grants, and incentive funds. BDB, in particular, targets expanding and relocating companies, offering them a slew of incentives coursed through government agencies.
Efficient permitting and regulatory procedures
Palm Beach’s local governments have streamlined permitting processes for commercial real estate development. For instance, the BDB offers expedited permitting to eligible building projects, enabling local companies to fast-track their operational expansion. This program gathers authorities, government agencies, and regulatory boards to simultaneously assess projects. This streamlined process reduces the time and costs associated with development projects.
Continuous tourism development
Though Palm Beach is already a global tourist destination, the county is not one to rest on its laurels. Recently, the county evaluated its tourism industry’s current state while planning its evolution through cutting-edge technologies and sustainability programs. Initiatives include creating a tourism master plan and the construction of another headquarters hotel in the convention center neighborhood. These steps aim to boost visitor and resident experience while supporting local businesses.
Best Places for Commercial Real Estate Investments in Palm Beach
Tax incentives, business benefits, and steady economic growth—these are only some of the reasons why commercial real estate investments in Palm Beach can be rewarding. Smart investors know how location could make or break a venture, which is why we’ve listed some of the county’s most promising locations.
West Palm Beach
Downtown West Palm Beach teems with office spaces and lifestyle amenities, such as trendy bars, charming boutiques, and a wide range of restaurants. Its spectacular oceanfront views are a huge draw for visitors. It also holds regular activities and diverse events that appeal to foodies, artists, families, and fitness enthusiasts. Meanwhile, Northwood Village is undergoing revitalization, making it desirable for new businesses.
Palm Beach Gardens
The PGA Boulevard Corridor is a hub for office properties, luxury stores, and dining venues. Since it sits near affluent residential neighborhoods, this area is a no-brainer for commercial investment. Investors should also look into Downtown at the Gardens, a mixed-use development that attracts tourists and locals because of its irresistible mix of retail, office, dining, and entertainment spaces.
Boca Raton
Mizner Park also features a mixed-use development that offers both residential and commercial units. Its ideal location and picturesque design make it a popular destination, ensuring a consistent flow of visitors and customers. Speaking of high foot traffic, the Town Center Mall Area around the high-end Town Center Mall is a magnet for retail and office investments.
Lake Worth Beach
Downtown Lake Worth Beach is worth looking into because of its exciting blend of historic charm and vibrant urban lifestyle. The streets are lined with palm trees, as well as vintage shops, restaurants, and assorted boutiques. Complete with a theater that showcases musicals and dance performances and with plenty of guest houses nestled in side streets, this area is filled with investment opportunities.
Jupiter
Here, you will find Abacoa, a planned community that merges residential, commercial, and recreational properties. Florida Atlantic University is located in this area, adding to the neighborhood’s growth potential and dynamics. Interested in waterfront properties? You should look into Harbourside Place, where hotels, offices, and lifestyle options converge.
Boynton Beach
Congress Avenue Corridor is experiencing major redevelopment and investment, making it a promising setting for commercial ventures. Meanwhile, Downtown Boynton Beach is undergoing revitalization, paving the way for a lively urban center with options for retail, dining, and office spaces.
Your Palm Beach Investment Awaits
With all these fascinating facets, Palm Beach stands as an exceptional destination for real estate investment. But such an important financial decision demands a partner who understands not just the local market trends but also your specific preferences.
The Frisbie Palm Beach Team knows exactly how you can get the most out of your investments. Led by Suzanne Frisbie, an accomplished broker-associate and undoubtedly one of the top real estate agents in Palm Beach since the 1980s, our team is committed to giving you personalized attention and services to guarantee a seamless investment experience. By choosing us, you’ve ensured success in navigating one of the most coveted real estate markets in the world.
Start your investment journey today by calling 561.373.0941 or sending us an email.