Robust market will continue to absorb new construction

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1 Research & Forecast Report GREENVILLE-SPARTANBURG-ANDERSON, SC INDUSTRIAL Q Robust market will continue to absorb new construction Crystal Baker Research Coordinator South Carolina Key Takeaways > > The Greenville-Spartanburg-Anderson industrial market should continue to expect low vacancy and rent increases. > > The skilled workforce and improving infrastructure will help recruit new companies and investors to the market. Skilled workforce development South Carolina is a flurry of industrial activity as the plans of an expanding Port of Charleston come to fruition, logistics infrastructure improvements begin and global companies continue to locate and invest in South Carolina. South Carolina was ranked #2 on the 2017 Top States for Doing Business commentary by Area Development magazine, in addition to being awarded a 2017 Silver Shovel Award in the States with 3 to 5 Million Population category. The Shovel Awards are awarded to states that are compiling healthy and impressive rosters of projects and announcements, expansions and new facilities. With these statewide honors, it is easy to see why business is picking up across the state, and the Greenville-Spartanburg-Anderson area is no exception. Industrial employment comprises 10% of the total workforce; in addition, there have been 1,700 total non-farm jobs added from January 2017 through January 2018, which is a 3% increase over last year. As major global employers locate throughout South Carolina, they strive to hire employees who have the skill set to fill the positions needed. There are several workforce development programs in the Greenville-Spartanburg-Anderson markets that assist in readying a skilled labor force. Apprenticeship Carolina and readysc are partnered with a network of five technical colleges within the GSA region who provide workforce training for both new and upskilling employees, in addition to apprenticeship programs to ensure when employers locate in South Carolina, they have capable and skilled employees to fill critical positions. Market Indicators Relative to prior period VACANCY NET ABSORPTION CONSTRUCTION RENTAL RATE** Note: Construction is the change in Under Construction. *Projected **Rent forecast is for metro-wide rents. Summary Statistics Q Greenville Industrial Market GSA Market Vacancy Rate 5.81% Change From Q (basis points) Absorption (Million Square Feet) New Construction* (Million Square Feet) Under Construction (Million Square Feet) *New construction is buildings delivered Asking Rents NNN Per Square Foot Per Year Market $3.91 Flex $8.15 Warehouse $3.71 Manufacturing $4.49 Q Q2 2018* The Center for Manufacturing Innovation, part of the Greenville Technical College system, was created to attract more people to a career in advanced manufacturing. In addition, top companies such

2 as BMW and Michelin have apprenticeship and mentoring programs to guide high school and college students through systematic training and mentoring to give them on-the-job skills. Often the apprentices pursue full-time careers within the mentoring company. Because a skilled workforce is critical within a growing economy, the Greenville-Spartanburg-Anderson area uses effective programs to bridge the workforce skill gap and heighten the confidence of new employers locating to the area. Market Overview The Greenville-Spartanburg-Anderson industrial submarket absorbed 4,537,258 square feet over the past year, and the average triple net market rental rate rose from $3.36 per square foot during the first quarter of last year to $3.91 per square foot this quarter. There were 19 new buildings added to the market this year, totaling 3,168,310 square feet; however, the vacancy rate still dropped from 6.62% during the first quarter of 2017 to 5.81% during the first quarter of Warehouse/Distribution The warehouse/distribution market segment is the largest sector within the Greenville-Spartanburg-Anderson industrial market, comprised of more than 195 million square feet, and there are currently 10 building proposed for construction that would add approximately 1.77 million square feet to the warehouse/distribution sector. During the first quarter of 2018, the warehouse/distribution vacancy rate dropped to 5.69%, down 127 basis points from the end of The average triple net rental rate increased this quarter and was $3.71 per square foot. Despite four new warehouses comprised of 663,365 square feet being delivered to the Greenville- Spartanburg-Anderson market this quarter, the market absorbed 2,830,641 square feet during the first quarter of Manufacturing The manufacturing sector of the Greenville-Spartanburg-Anderson market includes 16.8 million square feet of manufacturing buildings, and no new buildings were added this quarter. This sector posted a net negative absorption of 36,175 square feet this quarter; however, the average triple net manufacturing rental rate rose from $4.35 per square foot during the fourth quarter of 2017 to $4.49 per square foot this quarter. Flex The average triple net rental rates for Greenville-Spartanburg- Anderson flex space continues to rise; this quarter the rent is $8.15 per square foot up from $7.75 per square foot at the end of last year. The flex sector posted a net negative absorption of 15,437 square feet during the first quarter of 2018, and the vacancy rate rose to 11.94%, up from 11.59% during the fourth quarter of Capital Investments During the first quarter of 2018, there have been three projects announced in the Greenville-Spartanburg-Anderson area, one of them from an international company. The total capital investment is $55.5 million during the first three months of this year, and 240 jobs have been created. The investments are in the areas of biosciences, manufacturing and distribution. Significant Transactions The statewide expansion of logistics, automotive and aeronautical production is driving the expansion of manufacturing in the Greenville-Spartanburg-Anderson market. CoStar reports 22 leases were signed during the first quarter of They were spread throughout the Greenville-Spartanburg-Anderson market and ranged from as large as 121,000 square feet down to 2,150 square feet. CoStar also reported a strong sales quarter, with 36 sale transactions. Leases > > Pratt Industries renewed a 121,000-square-foot lease at 1410 Old Stage Road in Simpsonville. > > In Greenwood, a new 120,000-square-foot lease was executed by Castelli Magnet LLC at 111 Airport Industrial Road. Greenville-Spartanburg-Anderson Technical Colleges Partnered with readysc & Apprenticeship Carolina Source: South Carolina Technical College System, Colliers International 2 South Carolina Research & Forecast Report Q Greenville-Spartanburg-Anderson Industrial Colliers International

3 > > Jarden Plastic Solutions signed a renewal for 112,455 square feet at 1221 Batesville Road in Greer. > > Think Tank Brew Law signed a new lease at 101 Airport Road in Greenville for a 25,000-square-foot warehouse space. > > Moventas Inc. renewed a 20,956-square-foot lease at 380 Business Parkway in Greer. > > Mighty Dollar signed a lease for 10,000 square feet located at 1801 Rutherford Road. Sales > > A Class A 100,000-square-foot warehouse located at 1314 Highway 246 South in Greenwood sold for $36.2 million. > > Three industrial properties totaling 237,647 square feet and located in Forrester Park were purchased as a portfolio for $14.4 million. > > A warehouse located at 50 Beachtree Boulevard in Greenville was sold for $8.25 million. > > A 400,000-square-foot industrial building in Greenville was purchased for $6.8 million at 625 South Old Piedmont Highway. Construction Pipeline Construction activity remains high in the Greenville-Spartanburg- Anderson market, with 3.7 million square feet under construction. Delivered > > Valeant Pharmaceuticals completed construction on a 432,120-square-foot manufacturing facility located at 4011 Highway 417 in Spartanburg County. > > 301 Hyatt Street in Gaffney now has a completed 200,000-square-foot Class A warehouse. > > 150,000-square-foot Class B industrial building is now complete at 744 Frontage Road in Greenville. > > Construction is complete on a 46,055-square-foot Class B warehouse located in Piedmont, SC at 115 Lacannon Road. > > 412 Fairforest Way now has a 35,310-square-foot Class B industrial building in Greenville. > > A 10,000-square-foot Class B warehouse is complete at 364 West Phillips Road in Greer. Under Construction > > Construction continues at the Inland 85 Logistic Center in Greer. The Logistic Center is the largest speculative building in the market consisting of 500,280 square feet, which is expandable to 1,186,680 square feet, and is located on 324 acres of land. The delivery date for this project is expected to be year-end > > Construction continues for the 2.5 million-square-foot Michelin distribution center located on Highway 101 in Spartanburg County. The delivery of the first phase is expected this year. > > Plastics Omnium continues to construct a 650,000-square-foot plant in Moore at 310 Genoble Road. The anticipated delivery date is the summer of > > Construction continues for a 408,000-square-foot spec building in the Hillside Enterprise Industrial Park, located near I-85 and Highway 290 in Duncan, SC. Delivery is expected in August of Valeant Pharmaceuticals 4011 Highway 417 Woodruff, SC Source: CoStar 100 Ryobi Drive Anderson, SC Source: CoStar 3 South Carolina Research & Forecast Report Q Greenville-Spartanburg-Anderson Industrial Colliers International

4 > > Buildings A (which is a spec building) and B (which is preleased to Global Automotive Partners and will deliver in May of 2018), located on Apple Valley Road in Greer, SC, are currently under construction and will consist of 367,320 square feet. > > Velocity I, located at 901 Victor Hill Road, currently has 297,607 square feet under construction within Velocity Park in Greer, and delivery is expected during the spring of this year. > > Spartan Ridge Logistics Center at 2010 Nazareth Church Road in Spartanburg is adding a spec building comprised of 273,000 square feet and the projected completion date is November of > > Wingo Park has one building currently under construction consisting of 171,600 square feet at 2725 New Cut Road; delivery is expected by the third quarter of > > In Greer, there is a 100,000-square-foot warehouse under construction at 564 Gilliam Road, and the projected delivery date is the end of Market Forecast The Greenville-Spartanburg-Anderson industrial market construction activity is thriving. There were 663,365 square feet of industrial properties added to the market during 2018, 3.7 million square feet are currently under construction and another 1.88 million square feet of projects are proposed to begin construction. Nonetheless, the market should still expect continuing new-to-the market employer growth and success in the coming quarters, as national/international companies follow suit behind those already located within the market such as: BMW, Michelin, Lockheed Martin and General Electric. With the Greenville-Spartanburg- Anderson market boasting major industrial advantages such as the Greenville-Spartanburg-Anderson International Airport, the Greer inland port and railway lines with access to the Port of Charleston and the workforce training programs providing skilled workers to employers moving to the area, the new construction being built in this submarket is expected be quickly absorbed in 2018 as new employers to the market fill the industrial buildings and begin production. Greenville-Spartanburg-Anderson Industrial Market Conditions 2,779,029 SF Q Net Absorption $3.91 NNN PSF/YR Average Asking Rental Rate 5.81% Vacancy Rate Industrial Employment Greenville- Spartanburg-Anderson MSA Commercial Real Estate Growth Cycle: Where the market stands and where it is going. Number of Industrial Jobs Added 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan Total Industrial Employment (Thousands) NEW CONSTRUCTION RENTAL RATE EMPLOYMENT OCCUPANCY PHASE 1: RECOVERY COMMERCIAL REAL ESTATE GROWTH CYCLE PHASE 2: EXPANSION Industrial Jobs Added Industrial Employment PHASE 4: RECESSION PHASE 3: HYPERSUPPLY Source: Bureau of Labor Statistics, St. Louis Federal Reserve, Colliers International 4 South Carolina Research & Forecast Report Q Greenville-Spartanburg-Anderson Industrial Colliers International

5 Q Industrial Market Summary Statistics Greenville-Spartanburg-Anderson, SC MARKET ANDERSON COUNTY BUILDINGS INVENTORY DIRECT VACANT SUBLEASE VACANT TOTAL VACANT TOTAL VACANCY RATE (%) NET ABSORPTION RENTAL RATE (NNN) Flex/R&D 1 38, % - - Manufacturing 12 2,678,489 38,920-38, % - $5.55 Warehouse/Distribution , , % 37,855 $8.57 Anderson County Total , , % 37,855 $8.55 AUGUSTA ROAD DONALDSON Flex/R&D 4 74,687 6,000-6, % - $6.00 Manufacturing , % - - Warehouse/Distribution 164 9,945, , , , % 895,685 $3.82 Augusta Road Donaldson Total COWPENS , , , % 895,685 $3.87 Manufacturing 5 163, % - - Warehouse/Distribution 20 2,909, % - - Cowpens Total 25 3,073, % - - GAFFNEY Manufacturing 3 71,889 5,000-5, % 8,300 $3.00 Warehouse/Distribution 51 4,463, , , % 302,500 $3.65 Gaffney Total 54 4,535, , , % 310,800 $3.65 GREENWOOD COUNTY Flex/R&D 2 34,528 3,000-3, % - $3.20 Manufacturing 20 2,942, , , % - $2.75 Warehouse/Distribution 33 1,170, , , % 2,270 $3.75 Greenwood County Total 55 4,416, , , % 2,270 $2.88 HWY 101 CORRIDOR Flex/R&D ,544 3,000-3, % - $7.50 Manufacturing 3 388, % - - Warehouse/Distribution 151 7,321, , , % 10,240 $4.39 Hwy 101 Corridor Total 180 8,425, , , % 10,240 $4.45 HWY 221 CORRIDOR Flex/R&D 1 73, % - - Manufacturing ,663 73,700-73, % -10,000 $3.00 Warehouse/Distribution 50 3,827, , , % - $4.40 Hwy 221 Corridor Total 68 4,411, , , % -10,000 $4.17 HWY 29/129 CORRIDOR Flex/R&D 2 44,894 26,955-26, % - - Manufacturing , % - - Warehouse/Distribution , , , % -38,250 $2.34 Hwy 29/129 Corridor Total HWY 290 CORRIDOR , , , % -38,250 $2.34 Flex/R&D 2 62,690 16,600-16, % -7,200 $8.54 Manufacturing 14 1,336, % - - Warehouse/Distribution 79 8,351, , , % -5,000 $3.41 Hwy 290 Corridor Total 95 9,749, , , % -12,200 $3.69 HWY 585 CORRIDOR Flex/R&D ,045 78,755-78, % 36,900 $6.72 Manufacturing ,803 32,000-32, % -2,000 $2.75 Warehouse/Distribution 100 9,191, , , % 117,157 $3.73 Hwy 585 Corridor Total 141 1,039,260-1,039, % 152,057 $ South Carolina Research & Forecast Report Q Greenville-Spartanburg-Anderson Industrial Colliers International

6 Q Industrial Market Summary Statistics Greenville-Spartanburg-Anderson, SC MARKET HWY 81 CORRIDOR Flex/R&D 1 14,082 6,348-6, % - $5.00 Manufacturing 4 141, % - - Warehouse/Distribution 29 4,276, % 3,800 - Hwy 81 Corridor Total 34 4,431,820 6,348-6, % 3,800 $5.00 MAULDIN Flex/R&D ,369 26,690-26, % -9,712 $6.99 Manufacturing , , , % 3,100 $7.00 Warehouse/Distribution 126 9,137, , , % 338,710 $4.37 Mauldin Total , , % 332,098 $6.11 PELHAM ROAD Flex/R&D ,568 62,488-62,488 14,28% -17,074 $11.17 Manufacturing 7 193,806 54,975-54,975 28,37% -28,975 $4.45 Warehouse/Distribution 98 4,757, , , % -2,000 $5.45 Pelham Road Total 123 5,389, , , % -48,049 $6.06 PIEDMONT Flex/R&D 6 124,374 39,112-39, % -7,062 $8.28 Manufacturing 8 179,557 64,000-64, % -16,800 $3.25 Warehouse/Distribution 82 3,865,142 68,250-68, % 52,387 $4.02 Piedmont Total 96 4,169, , , % 28,525 $4.43 SIMPSONVILLE FOUNTAIN INN Flex/R&D 4 77,776 7,175-7, % - $8.00 Manufacturing 8 228, % - - Warehouse/Distribution ,952, , , % - $2.94 Simpsonville Fountain Inn Total WHITE HORSE Source: CoStar, Colliers International , , % - $3.19 Flex/R&D 1 18,502 18,502-18, % - $12.00 Manufacturing 1 23,665 23,665-23, % - $5.00 Warehouse/Distribution 73 5,519, , , % 715,814 $3.30 White Horse Total 75 5,201, , , % 715,814 $3.59 WINGO Flex/R&D 1 30, % - - Manufacturing ,147 32,500-32, % - $3.95 Warehouse/Distribution 58 8,521, , , % 33,103 $2.86 Wingo Total 75 9,036, , , % 33,103 $2.90 OTHER SUBMARKETS Flex/R&D 53 1,799, ,044 5, , % -11,289 $7.69 Manufacturing 119 5,050, , , % 10,200 $3.61 Warehouse/Distribution ,526,990 2,623,558 62,800 2,686, % 366,370 $2.78 Other Submarket Total 1,093 3,127,738 68,110 3,195, % 365,281 $3.04 MARKET TOTAL INVENTORY DIRECT VACANT SUBLEASE VACANT TOTAL VACANT TOTAL VACANCY RATE (%) NET ABSORPTION RENTAL RATE (NNN) Flex/R&D 149 4,413, ,669 5, , % -15,437 $8.15 Manufacturing ,817, , , % -36,175 $4.49 Warehouse/Distribution 2,506 9,493, ,012 9,897, % 2,830,641 $3.71 Market Total 2,966 10,932, ,322 11,342, % 2,779,029 $3.91 In January 2017, Colliers International benchmarked its industrial data set statewide. The new standard for collection is all industrial buildings 10,000 square feet or larger that can be readily adapted to an alternative industrial use. All properties were placed into a revised set of markets and submarkets and divided into three categories. Warehouse/Distribution, a facility primarily used for the storage or distribution or both of materials, goods and merchandise. Manufacturing, a facility used for the conversion, fabrication or assembly of raw or partly wrought materials into products or goods. Flex/R&D, a building designed to be used in a variety of ways with at least 30% of the rentable building area used as office. It is usually located in an industrial park setting. Specialized flex buildings can include service centers, showrooms, offices, warehouses and more. Due to the adjustments of the building inventory, comparison of data included in previously published market reports should be avoided. 6 South Carolina Research & Forecast Report Q Greenville-Spartanburg-Anderson Industrial Colliers International

7 400 offices in 69 countries on 6 continents $2.7 billion in annual revenue 2 billion square feet under management 15,400 professionals and staff FOR MORE INFORMATION: David Feild, CCIM Market President Greenville David.Feild@colliers.com Liz H. McCary Vice President, Marketing South Carolina Liz.McCary@colliers.com Crystal Baker Research Coordinator South Carolina Crystal.Baker@colliers.com GREENVILLE-SPARTANBURG-ANDERSON INDUSTRIAL PROFESSIONALS: Garrett Scott Vice President Logistics & Transportation Solutions Group Garrett.Scott@colliers.com John Montgomery Vice President John.Montgomery@colliers.com Brockton Hall, MRED Brokerage Associate Brockton.Hall@colliers.com Richard Jackson Brokerage Associate Richard.Jackson@colliers.com Richard Barrett, MCR Senior Brokerage Associate RO.Barrett@colliers.com Brannan Hudson Brokerage Associate Brannan.Hudson@colliers.com About Colliers International Colliers International Greenville 55 E. Camperdown Way, Suite 200 Greenville, South Carolina USA Colliers International Group Inc. (NASDAQ: CIGI; TSX: CIG) is a global leader in commercial real estate services with more than 15,000 professionals operating from 396 offices in 68 countries. With an enterprising culture and significant insider ownership, Colliers professionals provide a full range of services to real estate occupiers, owners and investors worldwide. Services include brokerage, global corporate solutions, investment sales and capital markets, project management and workplace solutions, property and asset management, consulting, valuation and appraisal services, and customized research and thought leadership. Colliers International has been ranked among the top 100 outsourcing firms by the International Association of Outsourcing Professionals Global Outsourcing for 10 consecutive years, more than any other real estate services firm. For the latest news from Colliers International, visit Colliers.com or follow us on Twitter (@ColliersIntl) and LinkedIn. www2.colliers.com Copyright 2018 Colliers International. The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report.