2009 Ccim Naiop Industrial Market Report


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Commercial Real Estate presentation about the 2009 Industrial/Warehouse and Distribution market in Birmingham and Central Alabama

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2009 Ccim Naiop Industrial Market Report

  1. 1. CCIM/NAIOP Industrial Market Review Presented by: Mark Byers, SIOR Executive Vice President EGS Commercial Real Estate
  2. 2. Birmingham Multi-Tenant Market <ul><li>3rd Quarter Statistics </li></ul><ul><li>14,320,000 sf tracked </li></ul><ul><li>81% occupied </li></ul><ul><li>19% vacant </li></ul><ul><li>2,718,000 sf available </li></ul><ul><li>539,000 sf of sublease space available </li></ul><ul><li>Note: Square Feet (sf ) </li></ul>
  3. 3. Birmingham Historical Occupancy 3rd Quarter Statistics
  4. 4. Birmingham Industrial Submarkets Southern 3.9 million sf 82.7% occupied Southwestern 2.2 million sf 63.3% occupied Eastern 1.3 million sf 90.0% occupied Central 4.2 million sf 84.3% occupied Oxmoor Valley 2.7 million sf 83.8% occupied
  5. 5. Map of Southeast
  6. 6. Birmingham Occupancy vs. Other Southeast Markets 3rd Quarter Statistics
  7. 7. Birmingham Vacancy vs. Other U.S. Cities 10.30% TOTAL - C&W MARKETS 10.60% TOTAL -ALL MARKETS SOURCE: Cushman & Wakefield Research 10.70% Tucson, AZ *** 12.80% Raleigh/Durham, NC *** 17.40% Memphis, TN *** 18.90% Detroit, MI *** 8.80% Tampa, FL 9% Portland, OR 9.20% Louisville, KY *** 7.30% Denver, CO 14.90% Syracuse, NY *** 10.10% Pittsburgh, PA *** 5.60% Los Angeles-South, CA 12.40% Dallas/Ft. Worth, TX 13.60% Suburban MD *** 15.50% Phoenix, AZ 4.40% Los Angeles-North, CA 15.80% Contra Costa, CA 16% Stockton/Tracy, CA 8.70% Philadelphia, PA 5.10% Los Angeles, CA 13.80% Columbus, OH *** 6.80% St. Petersburg/Clearwater, FL 9.70% Palm Beach, FL 10.10% Long Island, NY 7.90% Cleveland, OH *** 8.50% St. Louis, MO *** 15.20% PA I-871/I-78 Distribution Corridor 6.70% Lakeland, FL 11.40% Chicago, IL 13.90% Silicon Valley, CA 13.60% Orlando, FL 7.10% Kansas City, MO *** 14.30% Charlotte, NC *** 9% Seattle, WA 7.10% Orange County, CA 11.90% Jacksonville, FL 10.10% Central, NJ *** 8.40% San Francisco Peninsula, CA 8.90% Oakland, CA 13.50% Inland Empire, CA 15.80% Boston, MA 10.50% San Diego, CA 15.10% Northern, VA 10.50% Indianapolis, IN *** 22.70% Birmingham, AL *** 15.60% San Antonio, TX *** 7.40% Northern, NJ *** 9.70% Houston, TX 13.10% Bingham, NY *** 7.40% Salt Lake City, UT *** 8.90% Nashville, TN *** 12.80% Hartford, CT 11.40% Bellevue, WA 11.90% Rochester, NY *** 12.50% Minneapolis, MN 10.40% Hampton Roads, VA*** 12.90% Baltimore, MD 15.10% Roanoke, VA *** 8.80% Milwaukee, WI *** 10% Ft. Lauderdale, FL 18.20% Austin, TX *** 10.70% Richmond, VA *** 9.10% Miami, FL 24.50% Fredericksburg, VA *** 10.20% Atlanta, GA Overall Vacancy Rate Market Overall Vacancy Rate Market Overall Vacancy Rate Market Overall Vacancy Rate Market
  8. 8. A Few Local Successes <ul><li>Shelby West Corporate Park </li></ul><ul><ul><li>Owned by Shelby County </li></ul></ul><ul><li>Daniel Payne Industrial Park </li></ul><ul><ul><li>Owned by City of Birmingham </li></ul></ul>
  9. 9. Shelby West Corporate Park <ul><li>Fresenius Medical Care – 123,000 sf build-to-suit currently under construction </li></ul><ul><li>Various Land Sales </li></ul><ul><li>Shelby West Commerce Center – 154,000 sf speculative building completed 1 st quarter </li></ul>
  10. 10. Daniel Payne Industrial Park <ul><li>Old Dominion Freight Lines </li></ul><ul><ul><li>55,000 sf / 100 doors </li></ul></ul><ul><ul><li>Truck Terminal </li></ul></ul><ul><ul><li>Under construction </li></ul></ul><ul><li>M & A Supply Company </li></ul><ul><ul><li>70,000 sf </li></ul></ul><ul><ul><li>Office/Warehouse </li></ul></ul><ul><ul><li>2 nd Quarter Delivery </li></ul></ul>
  11. 11. Daniel Payne Industrial Park <ul><li>Conklin Metal Industries </li></ul><ul><ul><li>50,000 sf </li></ul></ul><ul><ul><li>Office/Warehouse </li></ul></ul><ul><ul><li>2nd Quarter Delivery </li></ul></ul><ul><li>Flowers Foods </li></ul><ul><ul><li>12,000 sf </li></ul></ul><ul><ul><li>Office/Shipping Depot </li></ul></ul><ul><ul><li>Under construction </li></ul></ul>
  12. 12. Birmingham Industrial Highlights <ul><li>Brice Building purchase of 63,000 sf building in the Oxmoor Valley submarket </li></ul><ul><li>Vital Records lease of 52,000 sf at Shelby Commerce Park in the Southern submarket </li></ul><ul><li>Kaman Industrial Technologies lease of 31,350 sf at Parkwest Corporate Center in the Southwestern submarket </li></ul><ul><li>InMark lease of 23,250 sf at Avondale Commerce park in the Central submarket </li></ul><ul><li>Pratt Industries lease renewal of 80,500 sf at Perimeter Industrial Park in the Southwestern submarket </li></ul><ul><li>Specialty Foundry Products purchase of 58,000 sf building in Southwestern submarket </li></ul>
  13. 13. Alabama Industrial Highlights <ul><li>Mando America Corporation’s 400,000 sf expansion in Opelika. </li></ul><ul><li>Mercedes’ 225,000 sf expansion in Vance. </li></ul><ul><li>Royal Technologies’ construction of 125,000 sf in Cullman. </li></ul><ul><li>Austal USA’s construction of 350,000 sf in Mobile. </li></ul><ul><li>Cash Acme’s 175,000 sf expansion in Cullman. </li></ul>
  14. 14. Intermodal Activity <ul><li>Norfolk Southern </li></ul><ul><ul><li>$112 million investment </li></ul></ul><ul><ul><li>316 acres </li></ul></ul><ul><ul><li>8,000 direct and indirect jobs </li></ul></ul><ul><ul><li>165,000 containers per year </li></ul></ul><ul><ul><li>1440 container parks planned </li></ul></ul><ul><li>CSX </li></ul><ul><ul><li>$6 million investment/upgrades </li></ul></ul><ul><ul><li>25 acres </li></ul></ul><ul><ul><li>300 container parks </li></ul></ul>
  15. 15. The Future of Industrial Construction <ul><li>700,000 sf 1 st generation space on the market today </li></ul><ul><li>3.25 million sf of industrial space available </li></ul><ul><li>Downward pressure on rates </li></ul><ul><li>Limited financing for owner-occupants and for speculative construction </li></ul><ul><li>No new speculative buildings </li></ul><ul><li>Built-to-Suit will require strong credit and long term leases </li></ul>
  16. 16. Market Forecast <ul><li>Leasing Activity – At a record low and will not improve until employment, consumer confidence and consumer spending increases. </li></ul><ul><li>Construction Activity – Basically has ceased nationwide for speculative industrial product. The same is true for Alabama. Local developers will not begin construction on planned projects until significant absorption of existing product takes place. </li></ul><ul><li>Sales – Until credit markets improve and demand increases, industrial building sales will continue to remain flat. </li></ul><ul><li>Opportunity – Companies should review their real portfolios because opportunities may exist to reduce real estate related occupancy costs. </li></ul>
  17. 17. CCIM/NAIOP Industrial Market Report Presented by: Mark Byers, SIOR Executive Vice President EGS Commercial Real Estate