The 108.5-million-square-foot Columbus warehouse/ distribution market finished the second quarter of 2012 with a vacancy rate of 15.2%, down 40 basis points for the quarter and down 10 over 12 months. The July rate was 15.0%. The big story in the second quarter is demand, with net absorption posting positive 610,000 square feet, quite a comeback from the first quarters’ negative 273,000 square feet. Reis reports two warehouse/distribution facilities have opened so far in 2012 totaling 234,000 square feet, accounting for the bulk of the years’ estimated construction. In a notable change from previous estimates, Reis predicts net absorption will total 727,000 square feet in 2012, allowing for a small drop in vacancy. Average asking and effective rents increased by 0.6% and 0.7% in the second quarter, respectively, to $3.29 psf and $2.95 psf. Both measures showed slight increases over 12 months. Asking and effective rents did manage to post 0.3% gains in July, however. Rental growth here continues to be poor. Asking and effective rents are forecast to post gains of 1.8% and 2.0% in 2012, modest performances at best, followed by more substantial annual gains in later years.
For the 12.95-million-square-foot Flex/R&D market, the second quarter of 2012 saw a decline in vacancy of 40 basis points, to finish at 21.0%. The rate is up 20 basis points over 12 months. The July rate is down 20 basis points. Reis reports a 125,000-square-foot Flex/R&D facility completed construction in the Southeast submarket in April. The rate is forecast to remain near 20.0% through 2013. On the rental front, average asking and effective rents were up 0.2% and 0.5% during the quarter, to $4.98 psf and $4.27 psf, respectively. The year-over-year gains were high at 3.3% and 4.1%, a standout performance for this property type. Gains of 1.6% and 2.1% are forecast for all of 2012, with larger increases to follow.
“The Columbus industrial market has shown little growth during the second quarter of 2012,” Cushman & Wakefield reports. This source reports vacancy at 9.5%, down 160 basis points over 12 months, and a direct asking rent of $5.13 psf.