Quarterly Market Report

Transcription

1 SAN ANTONIO INDUSTRIAL APRIL EXECUTIVE SUMMARY Industrial Market Following a resilient, San Antonio s industrial market slowed a bit during the first quarter of, in relation to the faster pace of the previous year. The vacancy rate for the metro area rose to 6.7% in, an increase of 70 basis points quarter-over-quarter and 60 basis points yearover-year. In addition, net absorption stood at negative 304,1 sq. ft. as of the quarter s end. Despite an uptick in these metrics, demand in the market has kept the overall market competitive on a statewide basis, which is an indicator of the requirements for bigger spaces for both real estate owners, investors and occupiers. San Antonio Economy Growth in the San Antonio economy continues at a steady pace. The unemployment rate (not seasonally adjusted) ticked up to 4.2% in February, up from 3.9% in January and above 3.6% a year ago. San Antonio remains below the Texas rate of 5.1% and the U.S. rate of 4.9%. Job growth in San Antonio increased by 6,200 jobs during the month in February. Education and Health Services had the largest monthly gain of 3,000 jobs. Government, mainly led by colleges and school districts, posted monthly growth of 1,600 jobs; while Leisure and Hospitality added 1,500 jobs. Trade, Transportation, and Utilities had the largest drop, losing 1,000 jobs. Supply & Demand Total Net Absorption Total Vacant (%) Market Indicators 20 Current Prior Quarter Q Year Ago Net Absorption (sq. ft.) -307,7 686, ,6 Vacancy (%) Availabiity (%) Avg Asking NNN Rent ($) Construction (sq. ft.) 837,817 1,002,8 1,998,705 Deliveries (sq. ft.) 425, , ,812 Inventory (sq. ft.) 8,969,290 8,544,072 6,530,967 HOUSTON AUSTIN SAN ANTONIO

2 SAN ANTONIO INDUSTRIAL Net Absorption San Antonio ended the first quarter of with negative 304,1 sq. ft. of net absorption. Flex space represented positive 15,895 sq. ft. of that total, Manufacturing space was responsible for positive 29,227 sq. ft., and Warehouse/Distribution space closed the quarter with negative 2,857 sq. ft. San Antonio s industrial market last saw negative quarterly net absorption in Q3, when it dropped to 183,822 sq. ft. Currently, the South Warehouse/Distribution submarket had the largest amount of negative absorption at 143,394 sq. ft. while the Northwest Flex submarket had the only positive absorption at 25,707 sq. ft. Tenants moving out of large blocks of space in include XPO Logistics, Inc. leaving 74,400 sq. ft. at 1511 Cornerway Blvd; Interceramic Tile & Stone moving out of 64,500 sq. ft. at Starcrest Dr; and San Antonio Quality Metals exiting 26,139 sq. ft. at 2 W Peden Aly. Tenants moving into large blocks of space in include International Paper taking 63,000 sq. ft. at San Antonio Distribution Center - Building 7; Caliber Collision Center leasing 45,500 sq. ft. at Caliber Collision Center; and Arion Perfume & Beauty, Inc. moving into 30,6 sq. ft. at Tri-County Industrial Park - Building 5. Availability and Vacancy San Antonio s industrial availability rate, which measures the total amount of space being marketed for lease, increased by basis points quarter-overquarter, from 9.4% to 9.5%. Among the major property types, Warehouse/Distribution ended the quarter at 6.0% availability, Manufacturing closed at 7.7% availability, and Flex space finished at 8.9% availability. Available sublease space in the San Antonio industrial market has not been a significant factor, representing less than 1.0%. In New Braunfels, Comal County Warehouse/Distribution submarket, availability jumped from 9.6% to 15.8% following the delivery of the I- Logistics Center at 175 Southwestern Ave., adding almost 400,000 sq. ft. to the market. Total Net Absorption by Industrial Property Type Historical Vacancy & Availability Flex Manufacturing Warehouse/Distribution Select Sale & Lease Transactions Sale/Buyer Building/Address SF Submarket 3030 Aniol LP Vereit Cl San Antonio Tx Llc Watershed Church Total Vacant (%) Total Available (%) Aniol Rd - Former Glazer's Distribution 111,800 Northeast 320 Lombrano St - Caliber Collision Center 45,500 North 9315 Broadway - Broadway Business Center 31,600 North Central Gerard A Sikkema 236 S US Highway ,000 South Lease/Tenant Building/Address Type/Deal SF Submarket Southern Warehousing Stout Drive New 147,840 South Arlon Perfume & Beauty, Inc Tri County Parkway Renewal 30,6 Comal County Crafco, Inc. 23 Danbury Street New 11,800 North Central O & S Traffic Supplies 1815 Capital Avenue Renewal,626 Northwest 2

3 SAN ANTONIO INDUSTRIAL Asking Rent Historical NNN Average Asking Rent The industrial market saw overall average asking rates drop $0.06 per sq. ft. quarter-over-quarter to finish at $5.63 per sq. ft. on a triple-net basis at the end of. The average rate for Flex space is at $.41 per sq. ft., Manufacturing rates averaged $4.27, and Warehouse/Distribution space is at $5.27. Even though rental rates dipped slightly this quarter, the citywide average asking rate since Q3, when the oil downturn hit markets across Texas, has averaged $5.61 per sq. ft. In addition, over 3.2 million sq. ft. of newly delivered space has hit the San Antonio industrial market during the last 15 months, with rental rates up $0.18 per sq. ft. year-over-year. $11 $9 $8 $6 $5 $3 Overall Flex Manufacturing Warehousoe/Distribution 20 Construction & Deliveries There is currently about 838,000 sq. ft. under construction in the San Antonio industrial market, with a large percentage of that space available for lease. The largest projects underway at the end of first quarter were Green Mountain Business Park #7, a 0,000-sq.-ft. building; and Alamo Ridge Business Park 4, a 96,930-sq.-ft. facility. Some of the notable deliveries include I- Logistics Center, a 397,600-sq.-ft. facility; and 1287 Industrial Dr., a 15,618-sq.-ft. building that delivered in first quarter and is now 75% occupied, both in Comal County. One of the most sought-after submarkets is the Northeast, in part because of its proximity to the I- corridor and convenient access to other major interstates. Two of the industrial market s largest deals were completed in that submarket at the end of, including Alamo Brewery s 54,400-sq.-ft. deal and Alamo Brokerage s 46,500-sq.-ft. lease at the Cornerstone Business Park. Under Construction & Deliveries Under Construction SF Deliveries SF 20 Leasing Activity Overall leasing activity was down slightly quarter-overquarter, from 814,561 sq. ft. to 808,029 sq. ft., while year-over-year was down almost 50%, from 1.5 million sq. ft. The average sq. ft. leased per quarter during the last years is approximately 1.0 million sq. ft. The largest lease signings occurring in included the 147,840-sq.-ft. deal inked by Southern Warehousing in the South submarket; the 30,6-sq.-ft. lease signed by Arion Perfume & Beauty, Inc. at Tri-County Industrial Park - Building 5 in the Comal County market; and 11,800 sq. ft. taken by Crafco Inc. at 23 Danbury St in the North Central market. Submarkets by Leasing Activity 9% 12% 8% 4% 3% Northeast South 33% North Central Northwest Comal Co. Guadalupe Co. CBD 31% 3

4 SAN ANTONIO INDUSTRIAL Submarket Stats Submarket Inventory Net Absorption YTD Net Absorpiton Total Vacancy (%) Total Availability (%) Deliveries YTD Deliveries Under Construction Overall Avg Asking Rent ($/PSF) CBD Total 3,483,518-15,178-15, Flex 442,528-8,3-8, Manufacturing 1,062, Warehouse/Distribution 1,978,565-6,868-6, Comal Co. Total 11,500,371-84,164-84, , ,218 20, Flex 251,372-21,930-21, Manufacturing 2,912, Warehouse/Distribution 8,336,544-62,234-62, , ,218 20, Guadalupe Co. Total 8,332,753-9,000-9, , Flex 136, Manufacturing 2,833, Warehouse/Distribution 5,362,399-9,000-9, , North Central Total 14,158,509-69,946-69, , Flex 3,653,070-11,131-11, Manufacturing 1,606,955-14,025-14, Warehouse/Distribution 8,898,484-44,790-44, , Northeast Total,627,619-27,9-27, ,000 12, , Flex 2,092,7-2,163-2, Manufacturing 5,219,130 58,492 58, Warehouse/Distribution 28,315,779-83,438-83, ,000 12, , Northwest Total 17,389,887 22,574 22, , Flex 4,486,857 25,707 25, , Manufacturing 2,743, Warehouse/Distribution,159,558-3,133-3, , South Total 18,476, , , Flex 371,799 33,722 33, Manufacturing 6,393,818-15,240-15, Warehouse/Distribution 11,711, , , San Antonio Market Total 8,969, ,7-307, , , , Flex 11,434,887 15,895 15, , Manufacturing 22,772,058 29,227 29, Warehouse/Distribution 74,762,345-2,857-2, , , ,

5 SAN ANTONIO INDUSTRIAL San Antonio Industrial Submarkets 1. CBD 2. Comal County 3. Guadalupe County 4. North Central 5. Northeast 6. Northwest 7. South Information and data within this report were obtained from sources deemed to be reliable. No warranty or representation is made to guarantee its accuracy. 181 SAN ANTONIO INDUSTRIAL 37 APRIL NAI Partners San Antonio Office 85 NE Loop 4, Suite 418 San Antonio, Texas tel Leta Wauson Director of Research leta.wauson@naipartners.com tel