Weekly Market Insights
 Industrial Vacancy vs. Warehouse Rent*
November 30, 2009 |
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| The drivers of demand for industrial space are beginning to firm: global trade, freight transportation, manufacturing activity and retail sales all seem to have hit bottom and either leveled out or posted slight gains recently. But the pending recovery is not yet strong enough to reverse the slide in occupier demand for industrial space. Expect the leasing market to soften further in 2010 with the vacancy rate hitting a peak of 11.4 percent by year end, a percentage point above its 2009-Q3 reading. The asking rental rate for warehouse/distribution space is projected to fall another 5 percent in 2010. In 2011, the vacancy rate should begin a slow descent while rent may slide another 2 percent due to the lingering excess of available space. The signs of improvement are there, but the recovery will be slow. Source: Grubb & Ellis |
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