DENVER-The area warehouse/distribution market saw its overall vacancy rate in 2002 rise to 7.2% from 5.4%, according to Steve Hager, an industrial broker with Cushman & Wakefield. However, the vacancy rate is still below the national average, and is poised to do even better in 2003, he says.

“The industrial market has not seen the serious downfall like the office market has,” Hager says.

Distribution warehouses, which make up 60% of the 173-million-sf industrial market, have done better than the flex buildings, where the vacancy rate rose to 11.3% from 8.5% last year. Also, a number of large tenants, such as General Motors, are looking for new facilities in the coming year, he adds.

“Consumer spending has kept the industrial market relatively healthy,” Hager tells

Hager expects the build-to-suit market to pick up in 2003, with big companies such as General Motors looking for new space. Major developers in 2003 will include locally based ProLogis and San Francisco-based Catellus Development.

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