Market of the Month - Palm Beach County, Florida
Palm Beach County, located in Southeast Florida, is experiencing a historic surge in growth, investment, and transformation. Known for its affluent enclaves, coastal lifestyle, and robust healthcare and education sectors, the county is emerging as one of Florida's most dynamic and competitive hospitality markets.
Stretching from Boca Raton to Jupiter and anchored by West
Palm Beach, the region is benefiting from a post-pandemic migration boom, a
luxury development wave, and the diversification of its economic base. With
high-profile financial firms relocating from the Northeast, giving the area the
nickname "Wall Street of the South," a booming medical sector, and an expanding
downtown core, Palm Beach County is quickly evolving into a premier destination
for business, travel, and lifestyle. In addition to being a strong tourist
destination, the area is home to the headquarters for several large companies,
including ADT Security Service, Florida Crystals Corporation, Sikorsky, a
subsidiary of Lockheed Martin, and Aerojet Rocketdyne, a subsidiary of L3Harris
Technologies.
The Palm Beach area has long been a renowned winter resort
for the wealthy; the recent influx of high-net-worth individuals has
significantly redefined the county's economic landscape. According to IRS and
Census Bureau data, following the COVID-19 pandemic, Palm Beach County
attracted more than $7 billion in net income migration in just one year. This influx
is fueling demand for luxury real estate, private investment, and hospitality. Palm
Beach County's medical sector is also one of its strongest economic pillars.
Several significant projects are reshaping the region:
- Related
Ross opened One Flagler, a new high-end office tower in Downtown West Palm
Beach, earlier this year, attracting New York-based equity groups OceanSound
Partners, GTCR, and GoldTree Asset Management.
- The
Nora District, a $1 billion walkable mixed-use neighborhood, is under
development just north of downtown West Palm Beach, blending retail,
hospitality, and residential uses. This development is just weeks away
from opening.
- Palm
Beach International Airport (PBI) is undergoing a multi-phase
modernization project to accommodate growth in both commercial and private
air traffic; this will include a 54,500-square-foot expansion.
- In
March 2026, the new Alan B. Miller Medical Center, a new 150-bed hospital with
a four-story medical office building and a helistop, is expected to open.
Additionally, HCA Florida Palms West Hospital is undergoing a major
expansion that will add 42 new patient beds.
- Palm
Beach State College and Florida Atlantic University are expanding life
sciences and tech programs to meet workforce demand.
Year-to-Date Trend
For the 12 months ending in July 2025, the market achieved a
12-month RevPAR growth of 11.1%, driven by a 5.3% occupancy gain and a 5.6% ADR
increase. This trend has been driven by continued strength in the weekend
leisure business, as well as by partially induced group demand from the
recently opened Belgrove Resort and Spa, West Palm Beach, Autograph Collection.
A mixture of leisure, group, and corporate demand generators drives hotel
performance for the area. The region's vast coastlines, new regional offices,
and popular tourist activities, such as shopping at the high-end retail destinations,
golfing at the PGA National Golf Courses, and visiting museums.
Year-to-Date Trends
New Supply
As of mid-2025, CoStar reports seven
properties under construction, totaling nearly 1,000 rooms, which makes up 5.2%
of the inventory. One notable development is the Mandarin Oriental Boca Raton,
part of a mixed-use luxury redevelopment of Mizner Park, slated to open in Q4
2025 with 164 rooms and 89 branded residences. Palm Beach County's hotel
pipeline remains heavily weighted toward luxury and lifestyle brands,
reflecting demand from a wealthy and design-conscious traveler base.
Transactions
Since the pandemic, coastal markets have attracted strong interest
from hotel investors due to increased leisure travel and significant asset
appreciation, resulting in high transaction volumes in 2021 and 2022. However,
elevated interest rates and a challenging capital markets environment have
since slowed deal activity, creating a bifurcation: institutional investors
pursue large deals with cheaper debt, while owner-operators focus on smaller
transactions. Meanwhile, corporate migration to West Palm Beach, particularly
in the financial services sector, has boosted investor confidence by
diversifying hotel demand beyond leisure. Year-to-date through May 2025, three
assets have traded for a combined sales volume of $427 million, while five
transactions occurred in 2024, resulting in a total sales volume of $421
million. One portfolio sale took place in January 2025, accounting for most of
the year-to-date deal volume - the 360-key PGA National Resort, PGA National
Golf Courses, and PGA National Health and Racquet Club, which transacted for
approximately $422.5 million.
Conclusion
Palm Beach County is undergoing a transformational period
marked by robust economic diversification, significant capital investment, and
dynamic population growth. The region's appeal extends beyond its historic
reputation as a luxury retreat, evolving into a thriving hub for finance,
healthcare, education, and hospitality. With landmark developments, strategic
infrastructure upgrades, and a strong pipeline of high-end hotel projects, the
area is well-positioned for sustained growth. The ongoing migration of
high-net-worth individuals, combined with rising group and corporate demand, is
reshaping the local economy and redefining Palm Beach County as a premier
destination for both business and leisure. As new supply enters the market and
investor confidence remains high, Palm Beach County's hospitality sector is
poised to remain one of the most competitive and lucrative in Florida.
