Breaking NewsGlobeSt.com will be offline for scheduled maintenance Friday Feb. 26 9 PM US EST to Saturday Feb. 27 6 AM EST. We apologize for the inconvenience.

 
X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

BOSTON-The region’s flex market sent a mixed message to users and investors during the second quarter of 2005 as vacancies declined 0.8% while negative absorption increased by 36,000 sf. This marks he fourth consecutive quarter of such negative absorption in the area’s flex market.

Brendan Carroll, an analyst with Richards Barry Joyce and Partners, tells GlobeSt.com that the decline in vacancies was due in large part to the conversion of several obsolete flex buildings to residential units, which reduced inventory. A recovery of the manufacturing segment has not hit New England. “The region is not benefiting from an uptick in demand for products and services to the extent the rest of the nation is,” says Carroll, noting that the high cost of production in New England has left that segment stagnant. “The office segment is seeing those benefits,but in terms of flex property, we’re just not seeing the growth we’re seeing with other property types.”

The Route 128 and Interstate 495 corridors, which contain over half of the area’s inventory, experienced positive absorption rates for the first time in four quarters but in the overall market, 22.6 % of all flex properties remained vacant. The numbers show that flex properties experience 3.3% more vacancies than warehouses, the second most vacant property type in the region, the report prepared by the company says. Owners also suffered from the high vacancy as lease rates dropped slightly by .05 cents to $9.96 per sf and tenant concessions increased.

Observers had expected flex facilities to face a quicker recovery due largely to the spillover from the state’s thriving biotech industry, Carroll notes, but that anticipated growth has not yet occurred. Carroll says that interest in older vacant flex buildings is increasing as developers eye them for conversion into residential and office properties.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.