BOSTON—The industrial property market in greater Boston realized positive gains during the third quarter posting approximately 800,000 square feet of warehouse, flex and manufacturing space absorbed by tenants, according to Transwestern | RBJ's “indSTATus – Fall 2014” report.
“This is the first quarter of the year in which all three industrial property types posted positive gains,” says Transwestern's Chase Bourdelaise, director of research for the Northeast. “When you pair the results with the office market, it's clear that Greater Boston's commercial real estate is realizing one of its strongest growth periods.”
The third quarter closed with a warehouse market vacancy rate of 13.2%, down from 14% the previous quarter. Asking lease rates were $5.73-per-square-foot, up from $5.53 from the previous quarter. With 356,000 square feet of positive absorption, the warehouse market extended its positive absorption streak to nine quarters, during which time there has been a net absorption of 3.8 million square feet.
The flex market closed with 255,000 square feet of positive absorption in the third quarter and a vacancy rate of 17%, down from 18% the preceding quarter. Asking lease rates remained steady at $8.29-per-square-foot. The 477,000 square feet of positive absorption over the past two quarters has reduced vacancy by 1.6 percentage points.
The third quarter closed with a manufacturing vacancy rate of 12.9%, down from 14.2% the previous quarter. Notably, more than 55% of the market's vacancy is concentrated in just five buildings, while the rest of the market is 6% vacant. Asking lease rates are $6.98-per-square-foot, up from $6.70 last quarter. The market reversed a three-quarter streak of negative absorption with 187,000 square feet of positive absorption.
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