Boston Industrial Vacancy Rates Decrease By .4%.
In the first quarter of 2013, Boston’s Industrial market has shown marked improvement in several areas when compared with data drawn from 2012. The market ended with an overall vacancy rate of 10% at the end of the quarter, decreasing from 10.4% at the end of the 4th quarter of 2012. The overall vacancy rate and sublease vacancy rate also dropped for flex and warehouse projects, respectively. In addition to a lower vacancy rate, the market has seen an increase in net absorption.
For this quarter, the net absorption for Boston’s overall Industrial market was a positive 2,213,195 square feet, compared to a positive 1,442,028 SF at the end of the previous quarter. Similar to vacancy rate, this growth is reflected in the figures for flex and warehouse projects, both of which have seen an increase in net absorption.
Quoted rental rates for Boston’s available industrial space have also risen from $6.09 per square foot per year at the end of the fourth quarter of 2012 to $6.14 per square foot per year at the end of the most recent quarter. This 0.8% increase in quoted rental rates reflects a spike in the value of industrial buildings. Sales activity is another contributing factor in determining the value of these buildings. The total year-to-date industrial buildings sales activity for 2012 is up from the previous year, both in terms of the number of industrial sales transactions and the average price per square foot.
One notable transaction that occurred within the last four quarters is the sale of 83 Commerce Way – Marshalls Distribution Center in Woburn. This 817,638-square-foot industrial building sold for $33,575,000 or $41.06 per square foot on 7/27/2012.