Q4 2011 | INDUSTRIALGREATER COLUMBUS REGIONINDUSTRIAL TRENDS REPORT                                                       ...
RESEARCH & FORECAST REPORT   |   Q4 2011  |  INDUSTRIAL   |   GREATER COLUMBUS REGION                        Delaware     ...
RESEARCH & FORECAST REPORT   |   Q4 2011  |  INDUSTRIAL   |   GREATER COLUMBUS REGIONUPDATE      Market ComparisonsINDUSTR...
RESEARCH & FORECAST REPORT   |   Q4 2011  |  INDUSTRIAL   |   GREATER COLUMBUS REGIONCENTRAL BUSINESS DISTRICT            ...
Upcoming SlideShare
Loading in...5
×

Q4 2011 - Columbus Industrial

204
-1

Published on

Published in: Business, Economy & Finance
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
204
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
1
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Q4 2011 - Columbus Industrial

  1. 1. Q4 2011 | INDUSTRIALGREATER COLUMBUS REGIONINDUSTRIAL TRENDS REPORT Growth, Expansion Marks 2011 INDUSTRIAL MARKET OVERVIEW The fourth quarter continued in positive growth from the second and third quarters with 52,000 square feet of positive absorption. The largest movement in absorption was expected from Mars Petcare moving out of more than 700,000 square feet in two separate facilities, 3051 Creekside and 3800 Groveport Road. With the completion of their new 1.3 million square foot facility last quarter, some large negative absorption was expected. Instead, Zulily took 737,741 square feet at 3051 Creekside driving 130,000 square feet of absorption. The new lease occurred while Allianz LifeMARKET INDICATORS Insurance Co. was under contract to sell property as a part of a portfolio sale to KTR Capital Partners. Q3 Q4 FORECASTS AND REFLECTION 2011* 2011** • There were six significant investment sales Albany is Knowlton’s 240,000-square-foot VACANCY (sales with full occupancy) in the Columbus facility, Axium Plastic’s 110,000 square foot market. STAG Industrial purchased the facility, and Pizzuti’s 303,000-square-foot NET ABSORPTION 385,000-square-foot 1120 Morrison Road for speculative warehouse. Pizzuti’s construction CONSTRUCTION $7.8 million, 9.0 percent cap rate. KTR Capital continues for MBM in Groveport as well with Partners purchased five properties from approximately 125,000 square feet. RENTAL RATES — — Allianz Life Insurance Co. as part of an 18 • Tenants are optimistic about growing consumer property sale. The Columbus transfer totalled demand, but cautious in expanding their lease *Actual change from previous quarter 2.5 million square feet for $62 million. for long terms (5+ years). Companies are still **Projected change from previous quarter • VeePak completed its 105,000-square-foot leery of another slowdown. facility in New Albany. Still underway in New RENTAL RATES PROPERTY TYPE VACANCY RATES OVER COMPLETIONSWEIGHTED AVERAGE RENTAL RATES Asking rental rates remainedRates for the Major Product Types 17.0 2,500,000 stable from last quarter. $72.5 $2.20 16.0 2,000,000 Supply has decrease over the $2.15 15.0 1,500,000 past two quarters by 1.62.0 $6 $2.10 percent points, from 13.5 to $2.05 14.0 1,000,000 1.5 11.8 percent. $5 $2.00 1.0 13.0 500,000 $1.95 $1.90 12.0 00.5 $4 $1.85 11.0 (500,000) 0 $1.80 $33Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q10 4Q10 10.0 (1,000,000) $2 9.0 (1,500,000) 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 08 08 09 09 09 09 10 10 10 10 11 11 11 11 8.0 (2,000,000) General Industrial R&D/Flex Warehouse/Dist. 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Q2 Q3 Q4 1 08 5 08 09 09 10 09 09 10 15 10 10 20 10 11 11 25 11 11 30 Completions Absorptions Total Market Vacancy Ratewww.colliers.com/columbus
  2. 2. RESEARCH & FORECAST REPORT | Q4 2011 | INDUSTRIAL | GREATER COLUMBUS REGION Delaware REGIONAL INDUSTRIAL ECONOMICS October, with an increase of 1.8 percent year County Union The Federal Reserve Bank of Cleveland reports over year. Mining, logging and construction County at least once a quarter in the Federal Reserve’s decreased by 1,000 employees from October North Beige Book about the economic activity of the and is up 13.9 percent year over year. LickingMadisonCounty County fourth district, which includes the Columbus East Metropolitan Statistical Area (MSA). The Beige ASKING RATES West Book from January 2011 reported that industrial Average asking rental rates increased slightly CBD activity in the fourth district grew at a slow pace from the second quarter. R&D/Flex space in the six weeks previous to January 11. Freight increased by $0.38; general industrial decreased Southwest Southeast Fairfield transportation executives reported that transport by $0.17; and warehouse/distribution by $0.01. County volume slowed along seasonal trends. Capital General industrial prices did not change Pickaway County outlays are expected to increase during 2012 for significantly but the amount of available space at fleet expansion and replacement of aging higher prices did change. The R&D/FlexThe Columbus industrial market consists equipment. increased substantially due to the actual changeof 10 suburban submarkets and the in prices, the median price increased only byCentral Business District. The totalinventory for the region is 213 million Manufacturers reported that new orders were $0.20 and the non-weighted mean increasedsquare feet of space mainly stable with any declines due to seasonal only by $0.10. As stated in the Q3 Market Report, factors. Demand is being driven by auto, energy the market has likely seen the end of bottoming and heavy equipment industries. Manufacturers prices and we expect that there will be slight remained committed to capital spending plans increases to asking rates. for 2012. Capacity utilization was below normal for all industries except for steel production. MARKET INTEL Hiring continued at a modest pace, but managers Market Activity Volume is the sum of the found it difficult to find high-skilled and absolute value of each absorption change in the professional workers. market. It tells us a little more about what exactly happened to the market behind the The Bureau of Labor Statistics reported that absorption number. The Market Activity Volume manufacturing employment of 63,100 employees was 3,654,787 square feet. With only 52,000 in November which was an increase of 800 over feet absorbed, the market seems to be settling October. Year over year manufacturing is down from the past two quarters, where large positive by 0.3 percent. Trade, transportation and utilities gains dominated the movement in the market. employment grew by 5,700 employees from MARKET ACTIVITY SALES ACTIVITY PROPERTY ADDRESS SALES DATE SALE PRICE SIZE SF GRANTOR GRANTEE PRICE / SF TYPE SUBMARKET 6766 Pontius Road November $17,000,000 754,000 Allianz Life Insurance Co KTR Capital Partners $22.55 Ware./Dist. Southeast 3051 Creekside November $18,500,000 737,000 Allianz Life Insurance Co KTR Capital Partners $25.10 Ware./Dist. Southeast Parkway 6250 Opus Drive October $13,739,300 676,564 CBRE Realty Trust Exeter Property Group $20.31 Ware./Dist. Southeast 5820 Opus Drive November $10,300,000 406,694 Allianz Life Insurance Co KTR Capital Partners $25.33 Ware./Dist. Southeast 1120 Morrison Road October $7,800,000 385,655 Hollingsworth Capital Partner STAG Industrial $20.23 Ware./Dist. East 5765 N Green Pointe November $8,900,000 358,760 Allianz Life Insurance Co KTR Capital Partners $24.81 Ware./Dist. Southeast Drive 5650 Green Pointe Drive November $7,300,000 270,000 Allianz Life Insurance Co KTR Capital Partners $27.04 Ware./Dist. Southeast 4252 Groves Road December $2,225,000 208,000 4252 Groves Road Equities City of Columbus $10.70 Ware./Dist. Southeast LEASE ACTIVITY PROPERTY ADDRESS LEASE SF LESSOR LESSEE ASKING PRICE (NNN) TYPE SUBMARKET 3051 Creekside Parkway 737,471 Allianz Life Insurance Co. Zulily $3.25 Warehouse/Distribution Southeast 3425 Urbancrest Industrial Dr 188,000 Security Capital Industrial Trust Round 2 - Warehouse/Distribution Southwest 3420 Urbancrest Industrial Drive 88,024 ProLogis Trust Exel $2.95 Warehouse/Distribution Southwest 111 Enterprise Drive 65,000 Paragano Nazario P.A.C. $2.70 Warehouse/Distribution Licking 2235 Southwest Boulevard 48,488 Industrial Southpark Owner LLC Cinco Electric $3.10 (MG) R&D/Flex SouthwestP. 2 | COLLIERS INTERNATIONAL
  3. 3. RESEARCH & FORECAST REPORT | Q4 2011 | INDUSTRIAL | GREATER COLUMBUS REGIONUPDATE Market ComparisonsINDUSTRIAL MARKET Net Absorption Construction Asking Rental RatesSUBMARKET Total SF Vacant SF Vacancy % Current Quarter Year-to-date Current Completions WH/Dist R&D/FlexCBD 5,907,062 685,817 11.6 30,500 392,858 - - - $6.59EAST 20,682,243 4,238,914 20.5 1,756 (463,580) - - $3.25 $6.00FAIRFIELD 6,771,842 617,675 9.1 (293,548) (214,948) - - $4.00 $6.90LICKING 18,832,930 1,297,016 6.9 65,000 402,874 773,000 105,000 $2.90 -MADISON 8,148,397 - 0.0 - - - - - -NORTH 16,747,138 1,589,882 9.5 (22,600) (124,468) - 70,000 $3.18 $5.16NORTH DELAWARE 9,132,849 1,057,267 11.6 (5,633) (175,016) - - $2.99 $6.75PICKAWAY 3,550,850 71,900 2.0 - - - - $2.48 -SOUTHEAST 64,181,757 10,347,192 16.1 (263,857) 920,384 125,000 - $2.62 $3.22SOUTHWEST 17,683,127 1,156,899 6.5 319,581 468,991 - - $2.92 $4.45UNION 6,333,817 362,765 5.7 143,800 151,032 - - - $4.33WEST 35,935,786 3,933,936 10.9 77,162 1,731,891 - - $2.34 $4.31TOTALS 213,907,798 25,359,263 11.9 52,161 3,090,018 898,000 175,000 $2.69 $4.66 Net Absorption Construction Asking Rental RatesSUBMARKET Total SF Vacant SF Vacancy % Current Quarter Year-to-date Current Completions By Product TypeR&D/FLEX 20,280,125 3,044,234 15.0 175,908 574,599 - 70,000 $4.66GENERAL INDUSTRIAL 71,945,139 5,890,939 8.2 147,147 295,603 428,000 - $3.07WAREHOUSE/ 121,752,534 16,424,090 13.5 (270,894) 2,219,816 470,000 105,000 $2.69DISTRIBUTIONTOTALS 213,977,798 25,359,263 11.9 52,161 3,090,018 898,000 175,000 $2.99QUARTERLY COMPARISON AND TOTALS Net Absorption Construction Asking Rental RatesQUARTER, YEAR Total SF Vacant SF Vacancy % Current Quarter Year-to-date Current Completions ($)Q3, 2011 213,802,798 25,411,424 11.9 1,286,321 3,037,857 1,003,000 1,800,000 $2.80Q2, 2011 211,998,240 26,697,745 12.6 2,113,899 1,751,536 1,992,000 - $2.80Q1, 2011 211,923,599 28,974,755 13.5 (362,363) (362,363) 1,992,000 - $2.72Q4, 2010 205,420,829 26,113,915 12.7 743,685 (766,901) 1,575,000 (536,292) $2.57 CONSTRUCTION McGraw-Hill Construction’s most recent report showed construction starts for commercial, industrial, hotel and institutional projects increased to $50 million in the eight-county region in September to $50 million, from $42.74 million in September 2010. The year to date total of nonresidential construction contracts through the first nine months of 2011 fell to $784.83 million which is 26 percent below 2010’s $1.07 billion. COLLIERS INTERNATIONAL | P. 3
  4. 4. RESEARCH & FORECAST REPORT | Q4 2011 | INDUSTRIAL | GREATER COLUMBUS REGIONCENTRAL BUSINESS DISTRICT feet of 3800 Groveport Road. Exel vacated 173,457 square feet 6360 Port Road.The Central Business District (CBD) added30,500 square feet of positive absorption in the 512 offices infourth quarter. The vacancy rate has steadily Construction continues on Pizzuti’s 125,000-square-foot facility for MBM in 61 countries onfallen over the past five quarters by 665 basispoints to 11.6 percent. Buckeye Diamond Groveport at 2240 Creekside Parkway. 6 continentsLogistics took 16,500 square feet at Techsouth SOUTH United States: 125C. Canada: 38 The southern submarkets are Pickaway and Latin America: 18EAST Fairfield counties. Fairfield lost 316,000 square Asia Pacific: 214 feet at 411 Ewing Street. No changes were EMEA: 117The submarkets comprising eastern Columbus recorded in Pickaway.are East and Licking County. Construction has • $1.5 billion in annual revenuebeen completed for VeePak’s 105,000 square • 978.6 million square feet under SOUTHWEST managementfoot facility as well as the 70,000 square feet of The Southwest submarket showed absorption ofPharmaforce’s new R&D/Flex facility. • Over 12,500 professionals 319,581 square feet. The largest gains in absorption came from Round 2 moving intoQuebec Ontario-based KDC is expected to UNITED STATES: 188,000 square feet of 3425 Urbancrestcomplete its 240,000-square-foot building in Industrial Drive. Exel moved into 88,000 square Columbusspring 2012. Mississauga, Canada-based Axium feet of 3420 Urbancrest Industrial Drive from Richard B. Schuen SIOR CCIMPlastics will complete a 110,000-square-foot CEO | Principal | Columbus the Southeast submarket. Cinco Electricfacility in spring 2012, employing 165. 8800 Lyra Drive absorbed 48,488 square feet of 2235 SouthwestConstruction continues on Pizzuti’s Suite # 150 Boulevard through purchase. Columbus, Ohio 43240303,000-square-foot speculative building TEL +1 614 410 5612planned for spring 2012. Sonoco is constructing WESTa 120,000-square-foot facility and is alsoexpected to be completed in 2012. The submarkets on the west side of Franklin Leslie Hobbs county are West, Madison and Union. The West Marketing and Research ManagerNORTH gained marginally with 3701 Lacon Road, which 8800 Lyra Drive was sold to an owner/user. Aoki Manufacturing Suite #150The submarkets comprising northern Columbus Columbus, Ohio, 43240 absorbed 55,470 square feet after purchasingare North and North Delaware. Both submarkets TEL +1 614 410 5640 1705 Atlas Street.lost a small amount of occupancy this quarter. Inthe North, DRC Automation moved out of 20,540 YEAR END WRAP-UP Jonathan Badgleysquare feet at 7830-7832 North Central Drive. The Columbus industrial market strengthened Research AnalystCarmel Pharma who had been leasing 13,120 175 South Third Streetsquare feet at 7029 Huntley was bought out and throughout 2011. Strong leasing in the second Suite # 285has been closed. In North Delaware, Granite Co. quarter and third quarter of 2,113,899 and Columbus, Ohio 43201moved out of 15,673 square feet of space. 1,286,321 square feet respectively, drove the TEL +1 614 437 4495Oxywater moved into 19,140 square feet at 8255 vacancy rate down 160 basis points.Green Meadows Drive. In 2010, the market had lost more than 2.5SOUTHEAST million square feet of industrial space from the demolitions of a Big Bear distribution facility on This document/email has been prepared by ColliersThe Southeast submarket incurred 263,857 International for advertising purposes. Colliers 3rd Avenue in Grandview and a property located International statistics and data are audited annually andsquare feet of negative absorption. 2175 Broehm at 200 Georgesville Road. In 2011, however, the may result in revisions to previously reported quarterlyRoad was purchased by an owner user adding and final year-end figures. Sources include Columbus market gained 1,975,000 square feet with Dispatch, Business First, Xceligent, and the Wall Street203,000 to occupancy. 3051 Creekside Parkway 898,000 square feet still under construction in Journal.has been fully leased by Zulily netting 130,000 2012.square feet of absorption. 1662 Williams Roadwas purchased by an owner user and added The largest leases of the year were Thirty-One96,034 square feet to occupancy. 4333 Directors Gifts leasing 750,000 square feet at 4545 FisherBoulevard was purchased by an owner user Road; Zulily, leasing 737,000 square feet at 3051adding 43,460 to occupancy. Creekside Parkway; and Sperian, leasing 500,000 square feet at 6766 Pontius Road.Significant negative absorption came from MarsPetcare’s vacancy of more than 700,000 square Accelerating success.www.colliers.com/columbus

×