Industrial Building Market Snapshot San Antonio Metropolitan Area

Industrial Building Market Snapshot San Antonio Metropolitan Area

Industrial Building Market Snapshot
San Antonio Metropolitan Area
Better information, better decisions.
First Quarter 2017
office 210 524 4000
fax 210 524-4029
reocsanantonio.com
reocsanantonioblog.com
8023 Vantage Dr, Suite 1200
San Antonio, TX 78230-4726
Industrial 1Q 2017
After a vigorous performance in 2016, it seems as if the San Antonio industrial market paused in the first quarter to catch
its breath. Despite new leases and expansions, the market experienced 84,529 square feet of negative net absorption.
New supply easily outpaced demand with four projects totaling more than 323,000 square feet of industrial space delivered
to the market before the end of March.
The citywide vacancy rates for distribution warehouse facilities loosened to 11.0% compared to 8.4% last quarter while the
vacancy rate for service center/flex properties increased to 8.9% compared to 7.6%.
The average cost for renting distribution warehouse space currently stands at $4.75 per square foot on an annual, triple net
basis, which is up by $0.52 compared to last year at this time.
The trend of large national tenants finding opportunity to grow in San Antonio continues. Similar to Dollar General, which
opened its one million square foot distribution center nearly a year ago, the parent company of TJ MAXX and Marshall’s is
the latest retailer to consider San Antonio for their next distribution center.
Citywide
All Property Types
Inventory
39,185,907
Direct Vacant
4,089,766
%Vacant
10.4%
Average Rent
$5.50
1Q Absorption
(83,751)
YTD Absorption
(83,751)
35,856,066
2,897,575
8.1%
$5.26
354,150
354,150
Central Business District
1Q 2017
All Property Types
Inventory
304,439
Direct Vacant
0
%Vacant
0.0%
Average Rent
n/a
1Q Absorption
0
YTD Absorption
0
Distribution / Warehouse
Inventory
29,547,247
Direct Vacant
3,235,928
%Vacant
11.0%
Average Rent
$4.75
1Q Absorption
65,328
YTD Absorption
65,328
28,246,039
2,137,496
7.6%
$4.23
361,000
361,000
Service Center/Flex Combined
Inventory
9,638,660
Direct Vacant
853,838
%Vacant
8.9%
Average Rent
$8.84
1Q Absorption
(149,079)
YTD Absorption
(149,079)
7,610,027
760,079
10.0%
$7.79
(6,850)
(6,850)
1Q 2017
1Q 2016
Suburban (Non CBD)
1Q 2016
233,395
0
0.0%
n/a
0
0
1Q 2017
All Property Types
Inventory
38,881,468
Direct Vacant
4,089,766
%Vacant
10.5%
Average Rent
$5.50
1Q Absorption
(83,751)
YTD Absorption
(83,751)
1Q 2016
35,622,671
2,897,575
8.1%
$5.26
354,150
354,150
Distribution / Warehouse
Inventory
258,439
Direct Vacant
0
%Vacant
0.0%
Average Rent
n/a
1Q Absorption
0
YTD Absorption
0
233,395
0
0.0%
n/a
0
0
Distribution / Warehouse
Inventory
29,288,808
Direct Vacant
3,235,928
%Vacant
11.0%
Average Rent
$4.75
1Q Absorption
65,328
YTD Absorption
65,328
28,012,644
2,137,496
7.6%
$4.23
361,000
361,000
Service Center/Flex Combined
Inventory
46,000
Direct Vacant
0
%Vacant
0
Average Rent
n/a
1Q Absorption
0
YTD Absorption
0
0
0
0
n/a
0
0
Service Center/Flex Combined
Inventory
9,592,660
Direct Vacant
853,838
%Vacant
8.9%
Average Rent
$8.84
1Q Absorption
(149,079)
YTD Absorption
(149,079)
7,610,027
760,079
10.0%
$7.79
(6,850)
(6,850)
Analysis by REOC San Antonio based on data provided by Xceligent and approved by the San Antonio Industrial Advisory Board.
Statistics based on all multi-tenant industrial facilities 20,000 square foot and larger excluding single-tenant, owner-occupied and government buildings.
Average rental rates reflect non-weighted strict average asking rental rates quoted on a triple net annual basis.
Current Quarter Lease Transactions
Tenant
Coastal Life Systems
Samuel's Glass
Pressure Systems International
Xpel Technologies
IBP
ISO Conversions
Gina Morris
Wayside Productions
Building
Alamo Ridge Business Park III
Interchange North II
Interstate Business Park II
Pam Am Distribution Center IV
5015 Airpark Drive
210 W. Peden Alley
18870 FM 2252
4351 Director Drive
Building
CSS Partners
400-442 N. WW White Rd.
3443 Steen Street
5823 Rittiman
4239 Dividend
Buyer
10511 Wetmore Road
Archdale Properties
JDL Marketing, LC
5828RP LLC.
BLB3 Properties
Size
134,750
53,840
43,200
32,770
31,274
26,139
23,000
21,500
Submarket
North East
North East
North East
North East
North East
CBD
North East
North East
Size
57,042
56,292
16,000
14,422
12,000
Submarket
North East
North East
North East
North East
North East
Current Quarter Sale Transactions
Industrial 1Q 2017
New Development
Submarket Map
Clockwise from top left: IH-35 Distribution Center, Eisenhauer Point,
Interchange North, Alamo Ridge 3 & 4.
Property Types
Distribution Warehouse – bulk warehouse facilities usually larger than
50,000 sf consisting of less than 30% office finish and featuring higher
clear heights and dock loading.
Definitions
Absorption (Net)
The change in occupied space in a given time period
Average Asking Rental Rate
Rental rate as quoted from each center’s owner/leasing/management
company. Industrial rental rates quoted on an annual triple net basis.
Direct Vacancy
Space currently available for lease directly with the landlord or building
owner; excludes sublease space.
SF/PSF
Square foot/per square foot, used as a unit of measurement
Sublease
Arrangement in which a tenant leases rental property to another and the
tenant becomes the landlord to the subtenant.
Sublease Space
Total square footage being marketed for lease by a tenant; sublease
space is not considered in the overall occupancy or absorption numbers
– only direct leases are included.
Sublease Vacancy
Space currently available in the market for sublease through the tenant to
a third party for the remainder of the tenant’s lease term.
Service Center – office showroom or light manufacturing space consisting
of 30% or more office finish/air-conditioned space and featuring optional
grade/dock loading, attractive landscaping, generous parking and
generally 12’ – 18’ clear heights.
Flex – new generation of service center product designed with flexibility to
serve as either office or warehouse space based on use of windows versus
overhead doors. The majority of Flex space in the San Antonio area has
been built since the late 1990’s and is finished as 100% office.
Criteria
This study includes industrial buildings in all major industrial parks and
developments, as well as other San Antonio area industrial buildings
20,000 square feet or larger. These figures do not include owner-occupied
buildings.
Services
REOC San Antonio is actively involved in all aspects of commercial real
estate: project leasing, acquisition and disposition, buyer and tenant
representation, site selection, property management, construction
supervision, development, research, marketing and consulting.
For additional information about our services, please contact:
Blake Bonner, Senior Vice President, Director of Brokerage
Direct Line: 210-524-1305 Email: [email protected]
For more information about this report, please contact:
Kim Gatley, Senior Vice President & Director of Research.
office 210 524 4000
fax 210 524-4029
reocsanantonio.com
reocsanantonioblog.com
Commercial Real Estate Since 1974
8023 Vantage Dr, Suite 1200
San Antonio, TX 78230-4726