BOSTON-Industrial in Greater Boston kept the momentum going through the end of 2013, Transwestern | RBJ said Thursday. The market in Greater Boston saw four million square feet of absorption last year, the highest 12-month total since 2000.
“When you are comparing positive market conditions to those not seen in more than a decade, then it's clear that the market is doing well,” says Brendan Carroll, SVP Transwestern | RBJ. “For the past 18 months, we've only seen one quarter of negative demand, in the manufacturing sector. Given that we are looking at three property types, that's a remarkably telling statistic.”
Among the three property types, warehouse had the best showing with the fourth quarter closing at 14.2% vacancy, down from 15.6% at the end of Q3 and 19.8% in mid-2012.Tenants have driven positive demand for six consecutive quarters, during which 3.4 million square feet has been absorbed, including the 793,000 square feet absorbed during Q4.
The market for flex space, too, saw a quarter-over-quarter vacancy drop from 17.6% in Q3 to 16.9%at the end of '13. Absorption of 182,000 square feet added to the eight-quarter streak of positive absorption, which has now reached 843,000 square feet. As with warehouse space, asking lease rates rose by eight cents in the most recent quarter.
Manufacturing did not fare quite as well in Q4, ending the three-month period with a vacancy of 12.8%, up slightly from 12.5% in Q3. Even so, asking lease rates are also up: from $6.40 per square foot in Q3 to $6.55 now. Transwestern | RBJ's “indSTATus – Winter 2014” report says the negative demand broke what had been an eight-quarter streak of positive absorption.
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