CINCINNATI, DAYTON, OH—The revival of the auto industry and growth of consumer spending, among other factors, has revived the market for industrial properties in much of Ohio. The Cincinnati/Dayton metropolitan area, for example, has attracted greater interest from industrial occupiers and investors. Cincinnati and its suburbs started off the year with nearly 1.3-million-square-feet of positive net absorption, according to Xceligent’s 1st Quarter 2014 Industrial Market Trends report. And Dayton companies also appeared busy, as that area also saw about 1.3-million-square-feet of positive net absorption.
The market for bulk warehouses was particularly healthy. In Dayton, these properties accounted for 484,420-square-feet of absorption, and the vacancy rate for them sank to only 6.8%. Around Cincinnati, bulk warehouses accounted for 820,109-square-feet of absorption. High-quality bulk warehouse space has become scarce, especially in the key Northern Kentucky submarkets of Florence/Richwood and Airport, which Xceligent reports have vacancy rates of 0.5% and 1.7%, respectively, for these buildings.
Manufacturing also put up some solid numbers. In Dayton, this sector accounted for 435,819-square-feet of positive absorption, and in Cincinnati, 152,875-square-feet, Xceligent reports.
Top leases in Cincinnati over the first quarter include: Wayfair taking 525,000-square-feet of bulk warehouse space in the Park West International building in the Airport submarket; and Pioneer Cladding & Glazing occupying 215,000-square-feet of manufacturing space at 4074 Bethany Rd. in the I-71 Corridor. In Dayton, the top leases were for bulk warehouses. Arnett Sales took 209,220-square-feet at 1261 Bruker Rd. in the Upper Valley submarket; and Abbott Laboratories occupied 99,425-square feet at 1260 Brukner.
And other experts predict the Cincinnati economy will continue to hum along. It has experienced steady annual job growth for the past three years, slightly under the US average, but should still bring in another 14,200 net jobs this year, according to the CincinnatiUSA Partnership and Northern Kentucky Chamber of Commerce 2014 Regional Economic Outlook report.
The relatively tight markets have certainly brought a lot of interest from developers. In the Dayton area, Prologis broke ground last fall on a 1.8-million-square-foot distribution center for Procter & Gamble in Union at the Global Logistics Airpark. The company expects to finish the project by November. And in Cincinnati, Xceligent notes that “1.5 million square feet of speculative bulk warehouse space is scheduled for delivery during the spring providing opportunities for tenants who may otherwise search outside of the region for suitable space.”
Download the full Q1 2014 Cincinnati Industrial report by clicking here.
Download the full Q1 2014 Dayton Industrial report by clicking here.