Light manufacturing, office and storage-needy tenants are renting bigger chunks of space these days. Reason: They’re discovering they can lease flex space in the suburbs or near-Downtown locations for far less than central business district rents.
Average rents are in the $10 to $14 sf range, compared with average $20 to $24 sf class A office rents in the CBD.
Vacancies in this 5.5 million-sf, niche industrial market category are at 10%, down from 11.6% in the first quarter. Thirteen second-quarter leases averaged 13,000 sf, up from the average 5,000 sf in past years, according to a new Rebman Properties Inc. report. .
Total absorption was 153,801 sf. Net leasing for the entire year is projected at 500,000 sf. New contruction under way totals 331,000 sf.
Meanwhile, in the area’s 99-building, 11.25 miillion-sf buld distribution sector, vacancies are up to 10.21 % from 9.65% in the first 90 days. This market had experienced six quarters of positive leasing activity until the second quarter. Reason: 63,181 sf of new product came on line.