1Q 2012 Nashville Industrial
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Transcript of 1Q 2012 Nashville Industrial
www.ColliersNashville.com
1Q
2012
2012
Forcast
VACANCY
NET ABSORPTION
CONSTRUCTION
RENTAL RATE
MARKET REPORTNASHVILLE
First Quarter Is Off To A Great Start For 2012As the nation continues to recover from the economic recession, the Nashville industrial market has shown flexibility and continued growth from the end of 2011. There are several indicators that the market improve during the upcoming year. The Nashville unemployment rate decreased to 6.9%, which is well below the national average of 8.3%, and the gross metro product (GMP) is up 7.0% from the pre-recession peak.
Companies are looking to indicators such as these to make decisions such as relocation and expansion. Nashville is already seeing this trend with the construction of the two Amazon.com distribution centers and the Nissan plant hiring over 1,000 people. Additionally, Saks just leased a 564,300 square foot warehouse in the Southeast Corridor, Bridgestone Americas leased a 332,000 square feet at Commerce Farms 3 and Gibson Guitar leased a 85,000 square feet in the IBD. These are just a few of the
MARKET INDICATORS
1Q 2012 | INDUSTRIAL
Nashville Industrial MarketSummary of Statistics, Q1 2012
Vacancy Rate: 10.8%
Absorption: 1,227,143 SF
Under Construction: SF
Asking Rents Per Square Feet: Overall Rental Rates: $4.30Warehouse - Distribution: $3.90Light Industrial: $3.04Heavy - Mfg: $3.00Bulk Warehouse: $3.08Flex/R&D: $7.83
Quarterly Comparisons and Totals
QUARTER BUILDINGSTOTAL
INVENTORY SF
DIRECT
VACANT
DIRECT
VACANCY
RATE
SUBLEASE
VACANCY
RATE
NET
ABSORPTION
CURRENT QTR
NET
ABSORPTION
YTD SF
UNDER
CONSTRUCTION
SF
AVG
ASKING
RATE
Q1.12 1,941 159,613,660 17,163,536 10.8% 1.3% 1,227,143 1,227,143 2,257,220 $4.30
Q4.11 1,940 158,955,449 17,928,840 11.3% 1.4% 462,046 1,477,068 1,624,000 $4.24
Q3.11 1,944 159,219,825 18,368,566 11.5% 1.4% 811,107 774,327 3,124,000 $4.51
Q2.11 1,944 159,138,430 19,577,486 12.3% 1.4% (115,610) (111,324) 589,000 $5.44
Q1.11 1,946 158,970,444 19,153,453 12.3% 1.6% 479,828 479,828 2,032,000 $4.27
By Property Type
BUILDING TYPE BUILDINGS
TOTAL
INVENTORY
SF
DIRECT
VACANT
DIRECT
VACANCY
RATE
SUBLEASE
VACANCY
RATE
NET
ABSORPTION
CURRENT QTR
NET
ABSORPTION
YTD SF
AVG
ASKING
RATE
Bulk Warehouse 98 38,774,808 7,568,841 19.5% 3.5% 408,500 408,500 $3.08
Flex/R&D 225 12,104,258 1,620,712 13.4% 1.4% 151,217 151,217 $7.83
Heavy - Mfg 7 855,347 0 0.0% 0.0% 0 0 $3.00
Light Industrial 560 58,199,950 2,661,192 4.6% 0.7% 0 0 $3.04
Warehouse - Distribution 1,051 49,679,297 5,312,791 10.7% 0.4% 667,426 667,426 $3.90
-
Updated 7-2011
MARKET REPORT | Q1 2012 | INDUSTRIAL | NASHVILLE
www.ColliersNashville.com
companies that have expanded in the last quarter and several more are expected to do the same in the remainder of the year.
Vacancy rates lowered to 10.8% from 11.3% in the fourth quarter of 2011. Absorption posted an impressive positive 1,227,143 square feet during the first quarter of 2012. Most absorption occurred in the East and Southeast Corridor.
“The industrial market h as shown some very positive signs during such a rough economic recession,” stated Terry E. Smith SIOR CCIM, company Partner and Executive Vice President. “Nashville and Middle Tennessee are experiencing great activity and good growth, especially when you look at the other parts of the country. I expect that 2012 will only get better as we move through the year.”
Flex/R&D
Bulk Warehouse
Heavy - Mfg
Light Industrial
Warehouse - Distribution
1Q 2012 | Vacancy Space By Type
0
100000
200000
300000
400000
500000
600000
700000
800000
Nort
h
Sou
thw
est
Wes
t
Sout
heas
t
East
IBD
1Q 2012 | Net Absorption By Submarket
DEFINITIONS
Absorption - The net change in occupied space between the current quarter and the previous quarter, calculated by summing all the positive changes in occupancy and subtracting all the negative changes in occupancy.
Available SF - Space currently being marketed for lease or sublease.
Total Building SF - All single & multi tenant office buildings above 20,000 SF excluding medical, government and owner occupied.
Vacancy Rate - Percentage rate of the total amount of physically vacant space divided by the total amount of existing inventory.
*Bold text denotes Colliers International transaction.
RECENT SALES TRANSACTIONSSALES ACTIVITY
PROPERTY SELLER/BUYER SALE PRICE SIZE SF SUBMARKET
308 Mallory Station Road LP R&D LLC / Mallory Station LLC $5,800,000 67,498 Cool Springs/Franklin
4350 Hurricane Creek Schreiber Foods / Dairy Farms of America $2,250,000 70,625 Southeast Corridor
260 Cumberland Bend Undisclosed / Mental Health Cooperative, Inc. $1,535,000 15,042 North
424-432 6th Avenue Undisclosed / KVB Music LLC $1,420,000 22,500 IBD
1040 Acorn Drive J Partnership / Acorn Properties LLC $1,375,000 45,000 IBD
RECENT LEASING TRANSACTIONSLEASING ACTIVITY
PROPERTY ADDRESS TENANT SIZE SF TYPE SUBMARKET
1 Walden Book Dr - Bldg I Saks 564,300 New Southeast Corridor
Commerce Farms 3 Bridgestone 332,000 New East
Ameriplex Gibson Guitar 85,000 New IBD
211 Nesbitt Lane M&W Warehouse 75,000 Expansion North
Space Park North Robinson Tire 73,125 Sublease North
Cam International Cloplay Building Products 60,000 Expansion Southeast Corridor
2140 Dayton Avenue Janis Services 46,500 New Southeast Corridor
MARKET REPORT | Q1 2012 | INDUSTRIAL | NASHVILLE
www.ColliersNashville.com
UPDATE Market Comparisons
INDUSTRIAL MARKET
SUBMARKET BLDGSTOTAL
INVENTORY SF
DIRECT VACANT
SF
DIRECT VACANCY RATE
DIRECT VACANCY
RATE PRIOR QTR
SUBLEASE VACANCY
RATE
NETABSORPTION CURRENT QTR
SF
NET ABSORPTION
YTD SF
AVG ASKING RATE
EAST 305 26,259,908 26,259,908 16.2% 18.0% 0.5% 382,573 382,573 $3.93
Bulk Warehouses 29 12,852,289 3,444,605 26.8% 29.4% 0.0% 332,000 332,000 $3.10
Flex/R&D 42 1,846,181 279,049 15.1% 16.9% 0.0% 19,323 19,323 $7.30
Heavy - Mfg 1 76,058 0 0.0% 0.0% 0.0% 0 0 -
Light Industrial 87 5,277,623 82,000 1.6% 1.6% 0.0% 0 0 $3.66
Warehouse - Distribution 146 6,207,757 456,543 7.4% 8.8% 2.3% 31,250 31,250 $3.89
NORTH 450 39,866,721 2,987,716 7.5% 7.7% 1.5% 61,670 61,670 $3.55
Bulk Warehouses 19 6,995,658 725,000 10.4% 10.4% 5.5% 3,000 3,000 $3.01
Flex/R&D 40 1,580,142 201,337 12.7% 15.1% 0.0% 31,251 31,251 $6.40
Heavy - Mfg 1 314,125 0 0.0% 0.0% 0.0% 0 0 $3.00
Light Industrial 140 17,073,026 404,725 2.4% 2.4% 1.3% 0 0 $2.63
Warehouse - Distribution 250 13,903,770 1,656,654 11.9% 12.3% 0.0% 27,419 27,416 $3.32
SOUTHEAST 419 51,253,908 6,764,382 13.2% 13.6% 2.2% 605,395 605,395 $4.18
Bulk Warehouses 44 17,302,331 3,371,236 19.5% 20.4% 5.6% 73,500 73,500 $3.03
Flex/R&D 79 4,355,439 788,775 18.1% 18.8% 0.7% 19,301 19,301 $7.48
Heavy - Mfg 3 149,990 0 0.0% 0.0% 0.0% 0 0 -
Light Industrial 103 17,245,482 926,890 5.4% 5.4% 0.6% 0 0 $3.37
Warehouse - Distribution 191 12,188,177 1,677,481 13.2% 13.8% 0.4% 512,594 512,594 $4.26
SOUTHWEST 235 13,615,850 665,570 4.9% 5.7% 0.9% 76,948 76,948 $6.79
Bulk Warehouses 4 918,130 28,000 3.0% 3.0% 0.0% 0 0 $4.50
Flex/R&D 42 3,389,764 224,977 6.6% 9.3% 1.2% 76,542 76,542 $8.39
Heavy - Mfg 1 100,000 0 0.0% 0.0% 0.0% 0 0 -
Light Industrial 58 3,381,693 66,414 2.0% 2.0% 2.4% 0 0 -
Warehouse - Distribution 130 5,826,263 346,179 5.9% 6.3% 0.0% 406 406 $4.79
WEST 125 10,581,561 775,459 7.3% 7.5% 0.0% 21,428 21,428 $3.16
Bulk Warehouses 1 500,000 0 0.0% 0.0% 0.0% 0 0 -
Light Industrial 53 7,480,503 725,459 9.7% 9.7% 0.0% 0 0 $3.18
Warehouse - Distribution 71 2,601,058 50,000 1.9% 2.7% 0.0% 21,428 21,428 $3.16
IBD 406 17,952,766 1,708,212 9.5% 9.4% 0.6% 79,129 79,129 $4.90
Bulk Warehouses 1 206,400 0 0.0% 0.0% 0.0% 0 0 -
Flex/R&D 22 932,732 126,574 13.6% 16.1% 10.9% 4,800 4,800 $10.15
Heavy - Mfg 1 215,174 0 0.0% 0.0% 0.0% 0 0 -
Light Industrial 119 7,729,134 455,704 5.9% 5.9% 0.0% 0 0 $3.00
Warehouse - Distribution 263 8,869,326 1,125,934 12.6% 12.1% 0.0% 74,329 74,329 $3.62
GRAND TOTAL 1,941 159,613,660 17,163,536 10.8% 11.3% 1.3% 1,227,143 1,227,143 $4.30
MARKET REPORT | Q1 2012 | INDUSTRIAL | NASHVILLE
www.ColliersNashville.com
UNITED STATES:
NashvilleNate GreeneManaging Partner300 BroadwayNashville, TN, 37201TEL +1 615 850 2729FAX +1 615 850 3229
DIRECTOR OF MARKETING
NashvilleAllison Schepman300 BroadwayNashville, TN, 37201TEL +1 615 850 2748FAX +1 615 244 2957
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Copyright © Colliers International
The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it.
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Jerry MieleDIR +1 615 850 2735
Associate
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Associate
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Associate
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Exectutive Vice President & Partner
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Executive Vice President & Partner
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Figure 1: Nashville Industrial Submarkets include North, East, Southest, Southwest, West and IBD.
Gallatin Rd.
Leba
non P
l.
West E
nd A
ve.
Harding Pl.
O ld Hickory Blvd.
Fran
klin
Moores Ln.
Murfreesboro Rd.
Nolensville Rd.
Done
lson
Pike
Briley
Pkwy.
Bell Rd
.
Woodmont Blvd.
Buena Vista
132
12
96
SOUTHWEST
WEST
SOUTHEAST
EAST
NORTH
IBD
Nate Greene, CCIMDIR +1 615 850 2729Managing Partner &
Partner