In his mid-year forecast, Hager says the metro-area warehouseand distribution space vacancy was 8.9% in the second quarter,compared with 9.2% in the first quarter of 2004 and 7.1% in thesecond quarter of 2003. The average rental rate in the secondquarter fell to $4.06 per sf from $.26 per sf in the first quarterand $4.96 per sf in the second quarter of 2002.
For flex space, the direct vacancy rate is 12.4% compared with12.7% in the first quarter and 12.5% in the first three months of2003. The average rental rate for flex space is $7.55, unsightlyfrom the $7.45 in the prior quarter, but down from $7.84 per sf ayear earlier.
"Lease rates continue to deteriorate, but are stabilizing,"Hager says. "Leasing activity is healthy with slight increase. Andwe still had good, positive absorption in the second quarter."
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