North American Industrial Highlights 4Q 2010

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Colliers International 4Q 2010 North American Industrial Highlights

Colliers International 4Q 2010 North American Industrial Highlights

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  • 1. Q4 2010 | INDUSTRIALNORTH AMERICAHIGHLIGHTS U.S. Industrial Market Finishes 2010 on a High Note Further Gains Anticipated in 2011 ROss J. MOORE Chief Economist | USAMARkET INdICATORsRelative to prior period The U.S. industrial market finished 2010 with a notable surge capping off three consecutive quarters of positive absorption. Solid demand for warehouse space in most regions coupled with minimal construction Q4 Q1 2010 2011* created the conditions for a sudden reversal in vacancy, and almost certainly heralds the beginning of the next cycle. The vacancy rate dropped nationally by nearly a quarter of a percentage point during the VACANCy quarter—significantly more in select markets. Despite newfound optimism and a noticeable pick-up in leasing activity, warehouse rents fell over the quarter, dropping by 2.1 percent to $4.60 per square foot. NET ABsORPTION With the economy registering healthy growth in the fourth quarter, and similar expansion anticipated in CONsTRuCTION coming quarters, demand for warehouse space is expected to increase as the year progresses. A giant positive for industrial markets is the continued rise in import and export activity which continues to benefit RENTAl RATE not only key port markets, but also any distribution nodes that are part of the supply chain. Another positive for warehouse markets is manufacturing, which continues to show surprising growth as measured by the *Projected Institute for Supply Management (ISM) manufacturing index. For January the ISM manufacturing index registered 60.8—the highest level in nearly seven years and well above the critical 50 level that indicates expansion. As 2011 unfolds the industrial market is expected to improve on the back of a thriving manufacturing sector and further increases in global trade.u.s. INdusTRIAl MARkET Although signs of a true rebound in the warehouse market are still a few quarters away, almost all economicsuMMARy sTATIsTICs, Q4 2010 indicators suggest demand for warehouse space will only increase during 2011. With almost no new warehouse construction coming onto the market, even a modest bounce-back in demand will quicklyVacancy Rate: 10.74%Change from Q3 2010: –0.22 u.s. INdusTRIAl MARkET Q4 2009 – Q4 2010 continued on page 7Absorption:28.6 Million Square Feet 30 12 Over the last three quarters, occupied Vacancy (%)New Construction: space has increased Million Square Feet 20 11 by 42.7 million square9.4 Million Square Feet feet, however, during 10 10 the period Q2 2008under Construction: and Q1 2010 occupied22.7 Million Square Feet 0 9 space shrank by 209.9 million square feet.Asking Rents Per square Foot: -10 8Average Warehouse/ -20 7Distribution Center: $4.60 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010Change from Q3 2010: –2.11% Absorption Completions Vacancywww.COllIERs.COM
  • 2. hIghLIghTS | Q4 2010 | industrial | north america uNITEd sTATEs | INdusTRIAl suRVEy EXIsTING INVENTORy (sF) NEw CONsTRuCTION NEw CONsTRuCTION CuRRENTly uNdER MARkET dEC. 31, 2010 Q4 2010 (sF) yTd 2010 (sF) CONsTRuCTION (sF) Atlanta, GA 588,384,000 0 2,900,000 1,632,000 Bakersfield, CA 31,466,000 0 530,000 487,000 Baltimore, MD 224,045,000 1,515,000 386,000 61,000 Boise, ID 31,909,000 0 131,000 0 Boston, MA 155,986,000 0 0 170,000 Charleston, SC 32,024,000 10,000 1,440,000 240,000 Charlotte, NC 282,509,000 51,000 201,000 39,000 Chicago, IL 1,312,700,000 549,000 2,667,000 3,728,000 Cincinnati, OH 254,878,000 156,000 156,000 175,000 Cleveland, OH 418,008,000 14,000 571,000 35,000 Columbia, SC 35,509,000 0 206,000 1,000,000 Columbus, OH 205,421,000 0 47,000 1,470,000 Dallas/Ft. Worth, TX 750,421,000 0 0 559,000 Denver, CO 277,478,000 13,000 890,000 153,000 Detroit, MI 480,580,000 240,000 301,000 0 Fairfield, CA 38,904,000 0 363,000 0 Fresno, CA 48,600,000 0 0 0 Ft. Lauderdale/Broward County, FL 126,385,000 0 69,000 63,000 Greenville/Spartanburg, SC 170,450,000 127,000 0 0 Hartford, CT 96,975,000 0 0 0 Honolulu, HI 38,530,000 0 0 0 Houston, TX 474,722,000 207,000 2,225,000 207,000 Indianapolis, IN 274,027,000 1,329,000 1,580,000 250,000 Jacksonville, FL 120,450,000 240,000 240,000 483,000 Kansas City, MO-KS 174,061,000 50,000 50,000 1,087,000 Las Vegas, NV 107,554,000 0 341,000 72,000 Little Rock, AR 45,056,000 0 253,000 570,000 Los Angeles – Inland Empire, CA 379,098,000 667,000 667,000 2,300,000 Los Angeles, CA 879,573,000 200,000 510,000 750,000 Louisville, KY 167,562,000 0 0 0 Memphis, TN 196,788,000 32,000 470,000 725,000 Miami, FL 226,047,000 62,000 407,000 0 Nashville, TN 158,293,000 2,045,000 924,000 2,045,000 New Jersey – Central 357,793,000 176,000 844,000 440,000 New Jersey – Northern 373,657,000 0 0 83,000 Oakland, CA 131,233,000 0 0 26,000 Orange County, CA 200,950,000 375,000 495,000 0 Orlando, FL 144,357,000 0 0 0 Philadelphia, PA 421,082,000 46,000 926,000 1,124,000 Phoenix, AZ 245,457,000 391,000 1,763,000 147,000 Pleasanton/Walnut Creek, CA 32,225,000 0 74,000 0 Portland, OR 174,413,000 60,000 60,000 60,000 Raleigh, NC 101,500,000 30,000 97,000 76,000 Reno, NV 73,732,000 0 0 0 Sacramento, CA 182,249,000 0 53,000 36,000 San Diego, CA 188,521,000 54,000 311,000 212,000 San Francisco Peninsula, CA 40,808,000 0 0 0 San Jose/Silicon Valley, CA 253,311,000 0 0 609,000 Savannah, GA 43,511,000 538,000 538,000 172,000 Seattle/Puget Sound, WA 291,496,000 0 0 0 St. Louis, MO 261,205,000 0 148,000 11,000 Stockton/San Joaquin County, CA 92,563,000 0 16,000 0 Tampa Bay, FL 214,839,000 0 0 0 Washington, DC 206,729,000 147,000 475,000 1,391,000 West Palm Beach, FL 58,796,000 30,000 30,000 34,000 u.s. TOTAl 12,894,820,000 9,354,000 24,355,000 22,722,000P. 2 | COllIERs INTERNATIONAl
  • 3. hIghLIghTS | Q4 2010 | industrial | north americauNITEd sTATEs | INdusTRIAl suRVEy ABsORPTION ABsORPTION VACANCy RATE VACANCy RATEMARkET Q4 2010 (sF) yTd 2010 (sF) sEP. 30, 2010 (%) dEC. 31, 2010 (%)Atlanta, GA 931,000 934,000 14.2 14.0Bakersfield, CA (76,000) 3,000 9.6 9.7Baltimore, MD 935,000 2,328,000 10.6 10.6Boise, ID 113,000 477,000 11.1 10.9Boston, MA 142,000 167,000 21.5 21.4Charleston, SC 1,516,000 2,621,000 12.8 11.2Charlotte, NC 177,000 (3,076,000) 14.1 14.0Chicago, IL 2,132,000 (2,380,000) 12.0 11.7Cincinnati, OH 1,414,000 2,226,000 8.7 8.1Cleveland, OH 939,000 (1,737,000) 9.7 9.5Columbia, SC 203,000 663,000 6.4 7.0Columbus, OH 744,000 (767,000) 13.2 12.7Dallas/Ft. Worth, TX 1,740,000 902,000 11.8 11.6Denver, CO 373,000 3,142,000 7.8 7.7Detroit, MI (3,685,000) (3,895,000) 14.4 15.4Fairfield, CA (367,000) (662,000) 14.8 15.8Fresno, CA 100,000 215,000 8.1 7.9Ft. Lauderdale/Broward County, FL 232,000 1,035,000 9.5 9.4Greenville/Spartanburg, SC 137,000 (119,000) 10.9 10.6Hartford, CT 6,000 6,000 9.3 9.3Honolulu, HI (152,000) 6,000 4.4 4.7Houston, TX 354,000 4,761,000 6.8 6.2Indianapolis, IN (459,000) (1,822,000) 8.9 9.0Jacksonville, FL 403,000 (32,000) 11.3 11.1Kansas City, MO-KS 859,000 48,000 7.5 7.0Las Vegas, NV (377,000) (1,177,000) 15.5 15.8Little Rock, AR 1,254,000 1,344,000 16.8 14.0Los Angeles – Inland Empire, CA 6,756,000 12,981,000 12.3 11.1Los Angeles, CA 1,501,000 (4,885,000) 5.3 5.2Louisville, KY 76,000 (2,005,000) 12.2 12.2Memphis, TN (367,000) 875,000 13.1 13.3Miami, FL 395,000 2,706,000 9.3 9.1Nashville, TN (479,000) (1,451,000) 14.0 13.9New Jersey – Central 1,927,000 1,787,000 11.3 10.8New Jersey – Northern 847,000 2,005,000 7.8 7.6Oakland, CA (118,000) (1,486,000) 9.5 9.5Orange County, CA 662,000 (68,000) 6.2 5.8Orlando, FL 534,000 1,115,000 12.8 12.4Philadelphia, PA 1,808,000 3,301,000 9.9 9.4Phoenix, AZ 1,393,000 4,687,000 17.7 17.2Pleasanton/Walnut Creek, CA 401,000 866,000 12.5 11.2Portland, OR 346,000 728,000 8.0 8.1Raleigh, NC (74,000) (220,000) 12.5 12.4Reno, NV 274,000 282,000 15.2 14.9Sacramento, CA (339,000) (1,632,000) 13.1 13.3San Diego, CA 820,000 1,278,000 11.6 11.3San Francisco Peninsula, CA 374,000 27,000 10.6 9.7San Jose/Silicon Valley, CA 699,000 (3,869,000) 13.8 13.0Savannah, GA 1,118,000 (237,000) 21.4 19.3Seattle/Puget Sound, WA 703,000 (241,000) 8.0 7.8St. Louis, MO 353,000 2,560,000 8.0 7.9Stockton/San Joaquin County, CA (552,000) (1,324,000) 17.3 17.9Tampa Bay, FL (225,000) (611,000) 11.1 11.2Washington, DC (34,000) 512,000 12.7 12.8West Palm Beach, FL 177,000 771,000 10.5 10.3u.s. TOTAl/AVERAGE 28,564,000 23,663,000 10.95 10.74 COllIERs INTERNATIONAl | P. 3
  • 4. hIghLIghTS | Q4 2010 | industrial | north america uNITEd sTATEs | INdusTRIAl suRVEy | sAlEs PRICE, CAP RATE ANd lANd PRICE As OF dECEMBER 2010 sAlEs PRICE CAP lANd PRICE lANd PRICE VACANCy FORECAsT ABsORPTION FORECAsT RENT FORECAsT MARkET (usd PsF) RATE (%) (usd PsF) suBMARkET (3 MONTHs) (3 MONTHs) (3 MONTHs) Atlanta, GA 35.37 9.00 1.00 Northeast Atlanta Down Up Same Bakersfield, CA 48.00 9.50 2.50 Bakersfield-North Same Same Same Boise, ID 45.00 1.75 Caldwell Same Same Same Boston, MA 40.00 3.75 Route 495 Down Up Same Charleston, SC 45.50 7.75 2.65 Ladson Down Up Up Chicago, IL 43.00 7.15 5.25 I-55 Corridor Same Down Same Cincinnati, OH 43.40 8.00 1.72 Airport Down Up Up Columbia, SC – – 1.10 Lexington Down Up Up Columbus, OH 25.00 7.90 0.38 Southeast Same Same Same Dallas/Ft. Worth, TX 50.00 8.30 1.60 South Dallas Down Up Up Denver, CO 42.00 8.50 5.00 Northwest Down Up Same Detroit, MI 30.00 8.00 – – Up Up Down Fairfield, CA 75.00 7.50 7.00 Napa, CA Up Same Down Fresno, CA 38.00 9.00 2.00 Southwest Down Up Same Ft. Lauderdale/Broward Co., FL – – – – Same Up Same Greenville/Spartanburg, SC 30.00 10.00 0.86 – Down Up Up Hartford, CT 40.00 8.50 1.49 North of Hartford Same Same Same Honolulu, HI – – – – Same Same Same Houston, TX 66.12 9.95 2.50 Northwest Down Same Up Indianapolis, IN 40.27 – 1.96 Park 100 Down Up Same Jacksonville, FL 45.00 8.20 – – Down Up Same Kansas City, MO-KS – – – – Same Same Same Las Vegas, NV – – 5.29 North Las Vegas Up Same Down Little Rock, AR 65.45 9.00 0.95 Port Industrial District Down Up Same Los Angeles – Inland Empire, CA 57.00 8.50 9.23 Riverside Down Up Up Los Angeles, CA 87.00 7.75 16.81 Industry Same Same Same Memphis, TN 25.00 9.50 1.25 DeSoto County Down Up Same Miami, FL 43.88 7.50 14.07 Various Same Up Same Nashville, TN 32.00 9.00 – – Up Same Down New Jersey – Central 47.87 – 11.25 Exit 8A Up Same Down New Jersey – Northern 48.09 6.00 13.45 Hudson Waterfront Same Same Down Oakland, CA 62.94 7.00 12.95 Oakland, CA Same Same Same Orange County, CA 112.00 7.00 18.00 Central Down Up Same Orlando, FL 36.77 – – – Same Up Down Philadelphia, PA 57.00 8.50 3.10 Lehigh Valley Down Up Same Phoenix, AZ 71.00 9.50 2.30 West I-10 Down Up Down Pleasanton/Walnut Creek, CA – – 6.80 Livermore Same Same Same Portland, OR 67.27 8.45 14.98 – Down Up Up Reno, NV 24.92 – 2.38 TRIC Down Same Same Sacramento, CA 50.00 8.25 2.22 Roseville/Rocklin Same Same Same San Diego, CA 133.82 – 15.25 Poway Down Same Same San Francisco Peninsula, CA 175.00 7.00 – – Same Same Same San Jose/Silicon Valley, CA – – – – Same Same Same Savannah, GA 40.00 8.50 2.00 Westside Down Same Same Seattle/Puget Sound, WA 193.74 7.43 4.70 Seattle/Puget Sound Down Up Same Stockton/San Joaquin County, CA 53.00 8.00 3.50 Stockton Up Down Down Tampa Bay, FL 49.01 7.70 – – Same Up Same Washington, DC – – – – Same Same Up West Palm Beach, FL – 6.43 13.78 Various Same Same Same u.s. AVERAGE 57.86 8.18P. 4 | COllIERs INTERNATIONAl
  • 5. hIghLIghTS | Q4 2010 | industrial | north americauNITEd sTATEs | INdusTRIAl suRVEy | RENTs As OF dECEMBER 2010 wAREHOusE/dIsTRIBuTION Bulk sPACE FlEX/sERVICE sPACE TECH/R&d sPACEMARkET sPACE (usd PsF) (usd PsF) (usd PsF) (usd PsF)Atlanta, GA 3.08 2.84 7.29 7.33Bakersfield, CA 4.00 3.92 7.00 –Baltimore, MD 4.66 – 9.91 –Boise, ID 4.50 4.50 6.30 6.30Boston, MA 4.50 4.95 7.50 9.50Charleston, SC 3.65 4.00 6.00 16.25Charlotte, NC 3.34 8.64Chicago, IL 3.84 2.69 8.30 –Cincinnati, OH 2.93 2.93 6.12 6.12Cleveland, OH 3.46 – 8.09 –Columbia, SC 3.75 3.75 – 9.50Columbus, OH 2.49 2.46 4.68 4.68Dallas/Ft. Worth, TX 3.00 2.70 6.80 8.40Denver, CO 3.50 3.25 8.50 9.50Detroit, MI 3.97 3.52 8.17 –Fairfield, CA 5.28 – 10.92 –Fresno, CA 2.40 2.28 4.00 5.50Ft. Lauderdale/Broward County, FL 6.67 6.43 9.40 9.75Greenville/Spartanburg, SC 2.75 2.95 7.00 17.00Hartford, CT 4.28 4.28 6.75 6.75Honolulu, HI 11.88 – – –Houston, TX 4.96 4.32 6.79 8.40Indianapolis, IN 3.71 2.96 8.77 –Jacksonville, FL 3.50 3.00 9.00 –Kansas City, MO-KS 3.97 4.19 7.04 7.04Las Vegas, NV 4.80 4.71 6.48 10.56Little Rock, AR 2.67 2.74 7.35 –Los Angeles – Inland Empire, CA 3.60 3.48 6.66 10.00Los Angeles, CA 5.64 5.28 11.20 13.15Louisville, KY 3.34 – 7.33 7.33Memphis, TN 2.54 2.49 7.35 10.00Miami, FL 6.80 7.04 11.20 11.92Nashville, TN 3.99 3.13 7.38 –New Jersey – Central 4.66 3.77 11.90 12.89New Jersey – Northern 5.93 5.63 10.89 5.94Oakland, CA 4.32 2.88 4.80 8.04Orange County, CA 6.96 5.76 12.95 13.75Orlando, FL 4.57 4.11 8.68 8.94Philadelphia, PA 4.00 3.75 7.00 11.00Phoenix, AZ 5.42 4.18 10.98 10.73Pleasanton/Walnut Creek, CA 4.80 4.20 12.60 –Portland, OR 4.97 4.64 8.88 5.95Raleigh, NC 3.95 – 9.13 –Reno, NV 3.48 3.20 6.24 9.84Sacramento, CA 4.41 3.77 8.40 9.84San Diego, CA 7.92 7.08 11.40 14.28San Francisco Peninsula, CA 9.24 9.24 21.24 21.24San Jose/Silicon Valley, CA 4.44 5.04 6.84 10.92Savannah, GA 3.95 3.75 7.00 10.00Seattle/Puget Sound, WA 5.62 – 10.12 –St. Louis, MO 3.93 – 9.66 –Stockton/San Joaquin County, CA 3.96 3.48 5.52 7.44Tampa Bay, FL 4.20 3.96 8.24 9.36Washington, DC 7.74 – 12.03 –West Palm Beach, FL 7.14 6.40 10.36 14.71u.s. AVERAGE 4.60 4.13 8.54 10.00Quarterly Change -2.10% -2.02% 0.51% -2.10% COllIERs INTERNATIONAl | P. 5
  • 6. hIghLIghTS | Q4 2010 | industrial | north america CANAdA | INdusTRIAl suRVEy EXIsTING INVENTORy (sF) NEw CONsTRuCTION NEw CONsTRuCTION CuRRENTly uNdER MARkET dEC. 31, 2010 Q4 2010 (sF) yTd 2010 (sF) CONsTRuCTION (sF) Calgary, AB 122,107,000 0 740,000 957,000 Edmonton, AB 77,072,000 230,000 730,000 113,000 Halifax, NS 7,075,000 5,000 102,000 0 Montreal, QC 347,771,000 0 180,000 24,000 Ottawa, ON 28,027,000 75,000 176,000 75,000 Regina, SK 16,175,000 0 600,000 532,000 Saskatoon, SK 19,700,000 60,000 190,000 170,000 Toronto, ON 760,332,000 120,000 1,551,000 958,000 Vancouver, BC 178,640,000 0 0 1,702,000 Waterloo Region, ON 61,180,000 0 223,000 135,000 Winnipeg, MB 79,308,000 – 118,000 136,000 CANAdA TOTAl 1,697,387,000 490,000 4,610,000 4,802,000 CANAdA | INdusTRIAl suRVEy ABsORPTION ABsORPTION VACANCy RATE VACANCy RATE MARkET Q4 2010 (sF) yTd 2010 (sF) sEP. 30, 2010 (%) dEC. 31, 2010 (%) Calgary, AB (778,000) 3,743,000 4.7 5.4 Edmonton, AB 401,000 1,691,000 4.3 4.1 Halifax, NS 34,000 227,000 5.4 5.0 Montreal, QC 878,000 1,905,000 6.4 6.2 Ottawa, ON 140,000 148,000 6.3 5.8 Regina, SK 58,000 1,255,000 1.7 1.3 Saskatoon, SK (32,000) 420,000 2.5 2.7 Toronto, ON (1,484,000) 4,092,000 5.8 6.0 Vancouver, BC 449,000 3,331,000 4.0 4.1 Waterloo Region, ON 498,000 (336,000) 9.4 8.4 Winnipeg, MB – 303,000 – 3.0 CANAdA TOTAl/AVERAGE 164,000 16,779,000 5.52 5.56 CANAdA | INdusTRIAl suRVEy | sAlEs PRICE, CAP RATE ANd lANd PRICE As OF dECEMBER 2010 sAlEs PRICE CAP lANd PRICE lANd PRICE VACANCy FORECAsT ABsORPTION FORECAsT RENT FORECAsT MARkET (CAd PsF) RATE (%) (CAd PsF) suBMARkET (3 MONTHs) (3 MONTHs) (3 MONTHs) Calgary, AB 105.00 7.00 12.05 Great Plains (SE) Up Up Up Edmonton, AB – – 14.60 Southeast Down Up Same Halifax, NS 86.00 8.13 4.25 Burnside Industrial Park Down Up Up Montreal, QC 85.00 8.25 11.00 St-Laurent Down Up Up Ottawa, ON 85.00 8.13 6.75 Central Ottawa Same Same Up Regina, SK 73.00 7.80 5.75 Ross Industrial Park Same Same Up Saskatoon, SK 110.00 7.50 9.11 Marquis Up Up Same Toronto, ON 64.52 6.98 9.88 Caledon Down Same Up Vancouver, BC 125.00 6.50 22.50 Metro Vancouver Same Up Same Waterloo Region, ON 65.00 7.50 7.46 Cambridge Down Up Up Winnipeg, MB 75.00 7.75 11.40 Southwest Down Up Same CANAdA AVERAGE 87.35 7.55 10.43 CANAdA | INdusTRIAl suRVEy | RENTs As OF dECEMBER 2010 wAREHOusE/dIsTRIBuTION Bulk sPACE FlEX/sERVICE sPACE TECH/R&d sPACE MARkET sPACE (CAd PsF) (CAd PsF) (CAd PsF) (CAd PsF) Calgary, AB 7.75 6.50 9.50 10.50 Edmonton, AB 6.80 6.15 8.15 8.40 Halifax, NS 7.00 5.50 8.95 13.95 Montreal, QC 4.00 4.00 6.50 8.50 Ottawa, ON 7.25 6.25 8.25 11.00 Regina, SK 8.50 6.50 12.00 14.00 Saskatoon, SK 9.00 8.00 11.00 13.00 Toronto, ON 4.98 4.56 7.15 7.75 Vancouver, BC 6.50 5.75 8.50 9.25 Victoria, BC 12.00 10.00 13.00 13.00 Waterloo Region, ON 4.07 3.54 8.33 8.33 Winnipeg, MB 4.50 4.00 7.00 8.00 CANAdA AVERAGE 6.86 6.07 9.21 10.70 Quarterly Change 0.77% -0.85% 0.90% 0.93%P. 6 | COllIERs INTERNATIONAl
  • 7. hIghLIghTS | Q4 2010 | industrial | north america u.s. INdusTRIAl sPACE uNdER CONsTRuCTION By TyPE – Q4 2010 U.S. Industrial Market Square Feet Finishes 2010 on a High Note 0 1,000,000 2,000,000 3,000,000 4,000,000 Continued from page 1 Chicago, ILLos Angeles – Inland Empire, CA translate into stronger fundamentals. Rents, however, are unlikely to firm Nashville, TN up until vacancies drop below 10.0 percent, which should occur by year- Atlanta, GA end. For most landlords and investors, the best that can be hoped for is Columbus, OH rising occupancy and fewer incentives. For tenants, 2011 is an opportune Washington, DC Spec time to sign a new lease, as 2012 will almost certainly be the inflection Philadelphia, PA Build-to-Suit period when warehouse rents begin their upward march. Kansas City, MO-KS Columbia, SC Occupancies rise for third consecutive quarter. For the third consecutive Los Angeles, CA three-month period, industrial markets registered an increase in occupied Memphis, TN space. For the fourth quarter, net absorption totaled 28.6 million square San Jose/Silicon Valley, CA feet (MSF)—a large increase from the third quarter, when occupied space Little Rock, AR increased by just 3.6 MSF, and in sharp contrast to the 17.6 MSF of Dallas/Ft. Worth, TX industrial space returned to the market in the Q4 2009. For the year, Bakers eld, CA Jacksonville, FL absorption totaled 23.7 MSF compared with –160.7 MSF in 2009. Of the New Jersey – Central 55 markets tracked in the U.S., 33 reported positive absorption during the Indianapolis, IN fourth quarter; however, sizeable gains in four (Inland Empire, New Charleston, SC Jersey, Chicago and Dallas) of the Big Five markets drove up the national San Diego, CA number. Canadian markets ended the year on a somewhat muted note, Houston, TX however, full-year absorption totaled 16.7 MSF, a stark turnaround from Cincinnati, OH 2009 when occupied space shrank by 700,000 square feet. Savannah, GA Boston, MA warehouse construction still at low levels but up from previous Denver, CO quarter. Fourth quarter completions totaled 9.4 MSF, a substantial Phoenix, AZ increase from the third quarter when 4.4 MSF were delivered to the New Jersey – Northern market, and a modest increase from 7.0 MSF completed in Q4 2009. Of Raleigh, NC the 9.4 MSF delivered, 71 percent was build-to-suit and 29 percent was Las Vegas, NV speculative construction. In the coming quarters construction isFt. Lauderdale/Broward Co., FL anticipated to be largely build-to-suit, with only 15 percent under Baltimore, MD construction at year-end classified as speculative. Quarter-end Portland, OR construction activity totaled 22.7 MSF, a modest increase from 18.6 MSF Charlotte, NC underway at the end of the third quarter but well below the 107.0 MSF Sacramento, CA recorded two years ago. Canadian construction remained subdued with Cleveland, OH West Palm Beach, FL merely 500,000 square feet completed in Q4 bringing annual construction Oakland, CA to 4.6 MSF. In 2009 Canadian warehouse construction totaled 15.7 MSF. St. Louis, MO u.s. industrial vacancy rate registers sharp drop during the quarter. The U.S. industrial warehouse vacancy rate dropped 22 basis points during the fourth quarter to register 10.74 percent. After a very slight increase in the third quarter, this brings the national vacancy rate back to CANAdA INdusTRIAl sPACE uNdER CONsTRuCTION By TyPE – Q4 2010 where it began the year. Vacancies in many markets appear to have peaked and are expected to drift lower over the coming quarters. About Square Feet three of every four tracked U.S. markets (41 out of 55) saw vacancy 0 1,000,000 2,000,000 3,000,000 4,000,000 decrease in Q4 while the balance registered no change or a modest Vancouver, BC increase. Canadian warehouse vacancies were little changed, increasing Toronto, ON Spec by just 4 basis points during the quarter to average 5.56 percent. Calgary, AB Build-to-Suit Rents continue to go lower despite a pick-up in demand. In spite of Regina, SK improvements in demand for industrial warehouse space, industrial rents Saskatoon, SK moved lower during the fourth quarter. Warehouse rents fell 2.1 percent Winnipeg, MB to register $4.60 per square foot while bulk rents dropped 2.0 percent to Waterloo Region, ON average $4.13 per square foot, flex rents marginally increased $0.04 to Edmonton, AB $8.54 per square foot and R&D rents slipped $0.21 to $10.00 per square Ottawa, ON foot. Canadian industrial rents largely held steady during the quarter with warehouse, bulk, R&D and flex all registering increases/decreases of less Montreal, QC than 1.0 percent. COllIERs INTERNATIONAl | P. 7
  • 8. hIghLIghTS | Q4 2010 | industrial | north america 480 offices in 61 countries on 6 continents United States: 135 Canada: 39 Latin America: 17 Asia Pacific: 194 EMEA: 95 • $1.9 billion in annual revenue • 2.4 billion square feet under management • over 15,000 professionals COllIERs INTERNATIONAl 601 Union Street, Suite 4800 Seattle, WA 98101 TEl +1 206 695 4200 FOR MORE INFORMATION Ross J. Moore Chief Economist | USA TEl +1 617 722 0221Glossary EMAIl ross.moore@colliers.comAbsorption—Net change in leased space over a one side and dock-height loading or grade level Copyright © 2011 Colliers International.given period of time. roll-up doors on the other. Less than 15 percent The information contained herein has been obtained office.Bulk space—100,000 square feet or more with up from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannotto 10 percent office space, the balance being Tech/R&d—One- and two-story, 10- to 15-foot guarantee it. No responsibility is assumed for anygeneral warehouse space with 20- to 36-foot ceiling heights with up to 50 percent office/dry lab inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of theceiling heights. All loading is dock-height. space (remainder in wet lab, workshop, storage material contained in this report. and other support), with dock-height and floor-Flex space—Single-story buildings having 10- to height loading.18-foot ceilings with both floor-height anddock-height loading. Includes wide variation in Triple Net Rent—Includes rent payable to theoffice space utilization, ranging from retail and landlord and does not include additional expensespersonal service through distribution, light such as taxes, insurance, maintenance, janitorialindustrial and occasional heavy industrial use. and utilities. All industrial and high-tech/R&D rents in this report are quoted on an annual, triple netInventory—Includes all existing multi- or single- per square foot basis in U.S. dollars.tenant leased and owner-occupied industrialwarehouse, light manufacturing, flex and R&D Vacancy Rate—Percentage of total inventoryproperties greater than or equal to 10,000 square available (both vacant and occupied) at the surveyfeet. date including direct vacant and sublease space.New Construction—Includes completed warehouse—50,000 square feet or more with upspeculative and build-to-suit construction. New to 15 percent office space, the balance beingconstruction quoted on a net basis after any general warehouse space with 18- to 30- footdemolitions or conversions. ceiling heights. All loading is dock height.service space—Single-story (or mezzanine) with10- to 16-foot ceilings with frontage treatment on Accelerating success.www.COllIERs.COM