PHILADELPHIA-Despite one recent trade here, Philadelphia’s industrial market is showing signs that it is leveling off, according to CB Richard Ellis’ Q4 report for the region. Reasons include the completion of several construction projects during the fourth quarter, adding close to two million sf of inventory–a considerable amount of which has already been leased. Meanwhile rising construction, land and entitlement have not yet been reflected in asking lease rates. In coming quarters, rents will either rise or begin to cut into developers’ profits, CBRE concluded.

Other trends pointing to a leveling off: direct vacancy rates inside the Greater Philadelphia industrial market rose 6.9%–up slightly from 6.39% at the close of third quarter 2007. By the close of 2007, its annual positive net absorption figures finished at just over 3.9 million-sf–less than when compared to the same time a year before.

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