Leasing, Absorption Get Hit in Third Quarter
- Oct 28, 2008
The industrial market, like every other major property sector, is trying to cope with the housing slump and weak economy. Leasing activity within the sector has declined considerably, and the industrial market also realized negative absorption in the second quarter, its first drop in occupancy in five years, according to a report from Colliers International. The report, “U.S. Real Estate: Caught in the Middle of a Credit Crisis and Faltering Economy,” also notes that the vacancy rate is forecast to grow at a rate of 1 to 1.5 percent over the next year. Rental rates, which have already decreased, are expected to come under even more fire to reduce in the coming months. Meanwhile, Tucson is the U.S. market with the lowest industrial availability rate, at 4.4 percent, according to CB Richard Ellis Inc.’s third quarter “United States National Industrial Availability Index.” Rounding out the top five are Las Vegas (6.5 percent), Houston (7 percent) and Salt Lake City and Long Island, N.Y. (tied at 7.6 percent). Austin didn’t fare as well, pulling in the highest availability rate at 23. 8 percent. Stamford, Conn., and Boston pulled in virtually the same marks, 19.9 percent and 19.8 percent respectively, trailed by Columbus at 18.9 percent and Baltimore at 17.4 percent.