AUSTIN-Positive absorption and falling vacancy rates highlighted Austin's Q2 industrial sector. According to local commercial real estate company NAI REOC, absorption was in the black at 356,683 square feet, while area-wide vacancy improved to 12% compared to 13.2% from Q1 and 15.9% recorded year over year.
According to Jerry Heare, NAI REOC's senior vice president, the current market is relatively balanced, with neither landlord nor tenant having a specific advantage. He adds, however, that "conditions are beginning to tilt in the landlords' favor." The company's research report points out that gains were evenly split between warehouse and flex/R&D property types.
NAI REOC senior vice president and director of research Kimberly S. Gatley tells GlobeSt.com that the forecast for the remainder of the year is more of the same – "slow but steady improvement in occupancy, which will put upward pressure on rental rates," she says.
The highlight of the second half of the year, however, will be delivery of a significant amount of new speculative space. "This is something the market has not seen for several years," Gatley says.
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