Quarter 2014 INDUSTRIAL & OFFICE MARKET REPORT...INDUSTRIAL MARKET STATISTICS - 4th QUARTER 2014...
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East Bay / Tri-Valley INDUSTRIAL & OFFICE MARKET REPORT Tri-Valley Industrial Inventory: 30,958,710 Tri-Valley Industrial Availability: 2,323,084 Tri-Valley Industrial Net Absorption: -252,389 Tri-Valley Availability Rate: 7.50% Tri-Valley Office Inventory: 23,883,437 Tri-Valley Office Availability: 2,640,686 Tri-Valley Office Absorption: -291,711 Tri-Valley Availability Rate: 11.06% Availability: Square footage that is marketed for lease which is available within 90 days. This also includes sublease space. Industrial Buildings are defined as buildings with a clearance of less than 22’ with drive in truck doors; some may have dock doors. These buildings can be used by a wide variety of users. Parking is usually limited. This is the most prevalent type of industrial building. Multi-tenant/incubator is defined as an industrial building that divides into units of less than 5,000± SF, with drive in truck doors and a ceiling clearance of less than 18’. These buildings are ideal for expanding small businesses. Warehouse and distribution buildings have a ceiling clearance of 22’ or greater, dock high doors, limited parking and an adequate apron for truck deliveries. Office/Flex/R&D buildings are characterized by having a parking ratio of at least 3/1,000± SF of building. They usually have a lower clearance height and can be one or two stories. The parking enables these buildings to be flexible in the type of user they can accommodate. Any user from pure office to research & development can take advantage of the flexibility of this type of building. Lee & Associates maintains an up-to-date database of all available properties and sold/leased properties. Visit us at www.lee-associates.com 2014 Ends & 2015 Begins The year ended similar to how it started. Long story short the market improved each quarter. Vacancies continued to drop and values showed a steady increase. Of course, there were some exceptions to the rule and we anticipate that being the case in 2015. Both interest rates and cap rates remained at historic lows throughout the year. While the market has improved greatly over the past several years, for the most part activity has been “steady” and, in some cases, “spotty”. Some spaces will sit vacant for several months while others will receive multiple offers nearly immediately upon availability. Forecast 2015 – It is very hard to know what impact the low cost of oil will bring and how long it might last, but our expectation is more of the same. Fewer options to consider, higher lease rates, higher sale values, and steady demand. In addition, we anticipate the construction of new spec development to occur – something we have not seen in many years. -Mike Furay MARKET SNAPSHOT KEY TERMS & DEFINITIONS 4 th Quarter 2014
Transcript of Quarter 2014 INDUSTRIAL & OFFICE MARKET REPORT...INDUSTRIAL MARKET STATISTICS - 4th QUARTER 2014...
East Bay / Tri-Valley
INDUSTRIAL & OFFICE MARKET REPORT
Tri-Valley Industrial Inventory: 30,958,710Tri-Valley Industrial Availability: 2,323,084Tri-Valley Industrial Net Absorption: -252,389Tri-Valley Availability Rate: 7.50%
Tri-Valley Office Inventory: 23,883,437Tri-Valley Office Availability: 2,640,686Tri-Valley Office Absorption: -291,711Tri-Valley Availability Rate: 11.06%
Availability: Square footage that is marketed for lease which is available within 90 days. This also includes sublease space.
Industrial Buildings are defined as buildings with a clearance of less than 22’ with drive in truck doors; some may have dock doors. These buildings can be used by a wide variety of users. Parking is usually limited. This is the most prevalent type of industrial building.
Multi-tenant/incubator is defined as an industrial building that divides into units of less than 5,000± SF, with drive in truck doors and a ceiling clearance of less than 18’. These buildings are ideal for expanding small businesses.
Warehouse and distribution buildings have a ceiling clearance of 22’ or greater, dock high doors, limited parking and an adequate apron for truck deliveries.
Office/Flex/R&D buildings are characterized by having a parking ratio of at least 3/1,000± SF of building. They usually have a lower clearance height and can be one or two stories. The parking enables these buildings to be flexible in the type of user they can accommodate. Any user from pure office to research & development can take advantage of the flexibility of this type of building.
Lee & Associates maintains an up-to-date database of all available properties and sold/leased properties.
Visit us at www.lee-associates.com
2014 Ends & 2015 BeginsThe year ended similar to how it started. Long story short the market improved each quarter. Vacancies continued to drop and values showed a steady increase. Of course, there were some exceptions to the rule and we anticipate that being the case in 2015.
Both interest rates and cap rates remained at historic lows throughout the year.
While the market has improved greatly over the past several years, for the most part activity has been “steady” and, in some cases, “spotty”. Some spaces will sit vacant for several months while others will receive multiple offers nearly immediately upon availability.
Forecast 2015 – It is very hard to know what impact the low cost of oil will bring and how long it might last, but our expectation is more of the same. Fewer options to consider, higher lease rates, higher sale values, and steady demand. In addition, we anticipate the construction of new spec development to occur – something we have not seen in many years.
-Mike Furay
MARKET SNAPSHOT
KEY TERMS & DEFINITIONS
4 th Quarter 2014
INDUSTRIAL MARKET STATISTICS - 4th QUARTER 2014MARKET ABSORPTION
Buildings Total SF Direct SF Sublease SF Available SF Direct Total Net AbsorptionDUBLIN
INDUSTRIAL 47 1,101,162 42,523 4,128 46,651 3.86% 4.24% 0MULTI TENANT/INCUBATOR 15 391,647 40,068 0 40,068 10.23% 10.23% -9,550FLEX/R&D 7 544,734 25,142 57,232 82,374 4.62% 15.12% 0WAREHOUSE/DIST 5 758,566 0 0 0 0.00% 0.00% 0TOTAL 74 2,796,109 107,733 61,360 169,093 3.85% 6.05% -9,550
LIVERMOREINDUSTRIAL 449 5,918,595 313,813 55,192 369,005 5.30% 6.23% -63,950MULTI TENANT/INCUBATOR 40 1,458,280 101,017 17,261 118,278 6.93% 8.11% -5,943FLEX/R&D 71 2,185,043 23,473 112,000 135,473 1.07% 6.20% 0WAREHOUSE/DIST 80 8,204,850 810,572 150,989 961,561 9.88% 11.72% -117,163TOTAL 640 17,766,768 1,248,875 335,442 1,584,317 7.03% 8.92% -187,056
PLEASANTONINDUSTRIAL 221 2,164,221 58,763 0 58,763 2.72% 2.72% -8,300MULTI TENANT/INCUBATOR 29 855,822 42,174 5,740 47,914 4.93% 5.60% -19,835FLEX/R&D 127 5,112,540 214,506 77,258 291,764 4.20% 5.71% -11,531WAREHOUSE/DIST 3 505,405 7,997 0 7,997 1.58% 1.58% -7,997TOTAL 380 8,637,988 323,440 82,998 406,438 3.74% 4.71% -47,663
SAN RAMONINDUSTRIAL 22 645,634 11,564 0 11,564 1.79% 1.79% 0MULTI TENANT/INCUBATOR 15 590,034 16,070 0 16,070 2.72% 2.72% -8,120FLEX/R&D 7 522,177 135,602 0 135,602 25.97% 25.97% 0TOTAL 44 1,757,845 163,236 0 163,236 9.29% 9.29% -8,120
MARKET TOTAL 1,138 30,958,710 1,843,284 479,800 2,323,084 5.95% 7.50% -252,389
INVENTORY AVAILABILITY AVAILABILITY RATE
OFFICE MARKET STATISTICS - 4th Quarter 2014MARKET ABSORPTION
Buildings Total SF Direct SF Sublease SF Available SF Direct Total Net AbsorptionALAMO
B 13 190,057 13,891 200 14,091 7.31% 7.41% 0TOTAL 13 190,057 13,891 200 14,091 7.31% 7.41% 0
DANVILLEA 5 87,989 2,110 0 2,110 2.40% 2.40% 0B 61 709,827 55,033 2,751 57,784 7.75% 8.14% -6,375TOTAL 66 797,816 57,143 2,751 59,894 7.16% 7.51% -6,375
DUBLINA 8 1,394,854 262,343 50,110 312,453 18.81% 22.40% -66,977B 41 1,070,648 137,138 3,518 140,656 12.81% 13.14% -6,162TOTAL 49 2,465,502 399,481 53,628 453,109 16.20% 18.38% -73,139
LIVERMOREA 24 494,319 17,001 0 17,001 3.44% 3.44% 0B 47 1,002,627 173,249 0 173,249 17.28% 17.28% -3,603TOTAL 71 1,496,946 190,250 0 190,250 12.71% 12.71% -3,603
PLEASANTONA 71 6,871,201 1,123,265 144,268 1,267,533 16.35% 18.45% -88,464B 79 1,404,213 140,780 8,297 149,077 10.03% 10.62% -19,258TOTAL 150 8,275,414 1,264,045 152,565 1,416,610 15.27% 17.12% -107,722
SAN RAMONA 37 8,969,154 365,683 82,547 448,230 4.08% 5.00% -94,161B 84 1,688,548 57,169 1,333 58,502 3.39% 3.46% -6,711TOTAL 121 10,657,702 422,852 83,880 506,732 3.97% 4.75% -100,872
MARKET TOTAL 470 23,883,437 2,347,662 293,024 2,640,686 9.83% 11.06% -291,711
INVENTORY AVAILABILITY AVAILABILITY RATE
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Lee & Associates East Bay / Tri-Valley - Market Report
QUARTER IN REVIEW4 th Quarter 2014
DUBLIN INDUSTRIAL AVAILABILITY
PLEASANTON INDUSTRIAL AVAILABILITY
LIVERMORE INDUSTRIAL AVAILABILITY
The Dublin Industrial Market has slipped from last quarter. The availability rate increased from 5.89% to 6.05%. There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Sean Offers
The Pleasanton Industrial Market has slipped from last quarter. The availability rate increased from 4.30% to 4.71%. There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Mike Furay
The Livermore Industrial Market has slipped from last quarter. The availability rate increased from 8.20% to 8.92%. There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Tony Ferreri
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
0
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20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
INDUSTRIAL MULTI TENANT/INCUBATOR FLEX/R&D
3rd Q '14 4th Q '14
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50,000
100,000
150,000
200,000
250,000
300,000
350,000
INDUSTRIAL MULTITENANT/INCUBATOR
FLEX/R&D WAREHOUSE/DIST
3rd Q '14 4th Q '14
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
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250,000
500,000
750,000
1,000,000
1,250,000
INDUSTRIAL MULTI TENANT/INCUBATOR FLEX/R&D WAREHOUSE/DIST
3rd Q '14 4th Q '14
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Lee & Associates East Bay / Tri-Valley - Market Report
QUARTER IN REVIEW4 th Quarter 2014
AVAILABILITY
ABSORPTION
LEASE RATE
AVAILABILITY
ABSORPTION
LEASE RATE
AVAILABILITY
ABSORPTION
LEASE RATE
DANVILLE OFFICE AVAILABILITY
SAN RAMON OFFICE AVAILABILITY
DUBLIN OFFICE AVAILABILITY
The Danville Office Market has improved from last quarter. The availability rate increased from 7.58% to 7.51%. There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Simon Vogt
The San Ramon Office Market has slipped from last quarter. The availability rate increased from 4.18% to 4.75%. There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Simon Vogt
The Dublin Office Market has improved from last quarter. The availability rate decreased from 20.42% to 18.38% There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Mark Rinkle
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150,000
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Class A Class B
3rd Q '14 4th Q '14
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100,000
150,000
200,000
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350,000
400,000
450,000
500,000
Class A Class B
3rd Q '14 4th Q '14
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50,000
60,000
70,000
Class A Class B
3rd Q '14 4th Q '14
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Lee & Associates East Bay / Tri-Valley - Market Report
QUARTER IN REVIEW4 th Quarter 2014
AVAILABILITY
ABSORPTION
LEASE RATE
AVAILABILITY
ABSORPTION
LEASE RATE
AVAILABILITY
ABSORPTION
LEASE RATE
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
PLEASANTON OFFICE AVAILABILITY
LIVERMORE OFFICE AVAILABILITY
The Pleasanton Office Market has improved from last quarter. The availability rate decreased slightly from 17.13% to 17.12%. There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Aron Hoenninger
The Livermore Office Market has improved from last quarter. The availability rate decreased from 13.14% to 12.71%. There was negative absorption from last quarter. The lease rates are trending upward. The trend for this area appears to be improving and we continue to see positive signs that this will continue. Prepared by Simon Vogt
0
200,000
400,000
600,000
800,000
1,000,000
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Class A Class B
3rd Q '14 4th Q '14
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Lee & Associates East Bay / Tri-Valley - Market Report
QUARTER IN REVIEW4 th Quarter 2014
AVAILABILITY
ABSORPTION
LEASE RATE
AVAILABILITY
ABSORPTION
LEASE RATE
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
3rd QUARTER ‘14 VS. 4th QUARTER ‘14 AVAILABILITIES
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TRI-VALLEY AVAILABILITY HISTORY
TRI-VALLEY ABSORPTION HISTORY
AVAILABILITY
CONDO AVAILABILITY
TRI-VALLEY OFFICE AVAILABLE HISTORYTRI-VALLEY INDUSTRIAL AVAILABLE HISTORY
TRI-VALLEY OFFICE ABSORPTION HISTORYTRI-VALLEY INDUSTRIAL ABSORPTION HISTORY
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1,000,000
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2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
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5,000,000
2007 2008 2009 2010 2011 2012 2013 2014
-1,400,000
-1,200,000
-1,000,000
-800,000
-600,000
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2008 2009 2010 2011 2012 2013 2014
-650,000-600,000-550,000-500,000-450,000-400,000-350,000-300,000-250,000-200,000-150,000-100,000-50,000
050,000
100,000150,000200,000250,000300,000350,000
2008 2009 2010 2011 2012 2013 2014
6,278
6,037
23,151
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150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 550,000 600,000 650,000
Livermore Industrial Pleasanton Industrial Pleasanton Office
Inventory Availability
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2007 2008 2009 2010 2011 2012 2013 2014
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Lee & Associates East Bay / Tri-Valley - Market Report
QUARTER IN REVIEW4 th Quarter 2014
East Bay / Tri-Valley
TRANSACTIONS
LEE AVAILABLES
Land - ±200.11 Acres – SOLDGreenville Road, Livermore
GREENVILLE ROAD LAND CO. LLC
Indusrtial - 181,554± SF – SOLD6474-6538 Patterson Pass Rd., Livermore
MKD INVESTMENTS
Office - 25,071± SF – SOLD5020 Franklin Drive, Pleasanton
ACG CERTIFIED PUBLIC ACCOUNTANTS
Industrial - 27,000± SF – LEASED6538 Patterson Pass Rd., E & F, Livermore
LOST WORLD FAMILY FUN CENTER
Office - 74,964± SF – SUBLEASED4140 Dublin Blvd., #300-400, Dublin
CALLIDUS SOFTWARE, INC.
Industrial - 44,480± SF – LEASED7503 Las Positas Road, Livermore
UNITS
Go to www.lee-associates.com for complete property listings
OFFICE SPACE FOR LEASE
1,586± SF89 DAVIS ROAD
ORINDA
RETAIL SPACE FOR LEASE
1,950± SF6046 DOUGHERTY ROAD
DUBLIN
OFFICE SPACE FOR LEASE INDUSTRIAL BLDG. FOR SALE/LEASE
3,847± SF & 2,291± SF6601 OWENS DRIVE, SUITES 250 & 270
PLEASANTON
24,280± SF1306 STEALTH STREET
LIVERMORE
INDUSTRIAL SPACE FOR LEASE
29,923± SF240 SOUTH VASCO ROAD
LIVERMORE
OFFICE SPACE FOR SUBLEASE
3,261± SF2123 YGNACIO VALLEY ROAD #100
WALNUT CREEK
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Pleasanton Office
YOUR TEAM
8
MIKE FURAYManaging Broker
JOHN BLATTERAssociate
BRYAN BOWERSAssociate
TONY FERRERIPrincipal
MARK PLEISPrincipal
MARK RINKLEPrincipal
MIKE SMITHPrincipal
JESSICA MAUSERAssociate
VIRGINIA VOELKELPrincipal
SIMON VOGTPrincipal
TIM WILLETTAssociate
MITCH YADENAssociate
ARON HOENNINGERPrincipal
BRETT HOLDENPrincipal
BOB KUMNICKPrincipal
ABOUT LEE & ASSOCIATESLee & Associates, founded in 1979, is one of the largest regional commercial real estate providers in the United States.
Since 1979, our seasoned, motivated shareholders and professionals have been offering comprehensive quality service nationally and locally in a pro-active manner. We develop customized solutions for all of your real estates needs through our market-to-market knowledge in all property types. Our unique business model and extensive experience has helped us become one of the largest commercial real estate providers in the United States.
5890 Stoneridge Drive, Suite 210, Pleasanton, CA 94588www.lee-associates.com/
SEAN OFFERSPrincipal
Established in 1979 in Irvine, California, Lee & Associates has 51 nationwide offices that are individually owned by the shareholders of that office, thus encouraging an entrepreneurial spirit and allowing more freedom and creativity to make real estate transactions work
NATIONAL ORGANIZATION, LOCAL OWNERSHIP
Over the past 35 years, there has been an explosive growth of Lee & Associates offices throughout the country, making it one of the largest and fastest growing commercial real estate organizations in the United States.
EXPLOSIVE GROWTH
2014 - Denver, CO2014 - Cleveland, OH2013 - Long Island-Queens, NY2013 - Chesapeake Region , MD2013 - Charleston-Dwntn, SC2012 - Edison, NJ2012 - Orlando, FL2012 - Charleston, SC2011 - Fort Myers, FL2011 - Kansas City, KS
2011 - Manhattan, NY2011 - Greenville, SC2010 - Atlanta, GA2010 - Greenwood, IN2010 - Indianapolis, IN2009 - Long Beach, CA2009 - Elmwood Park, NJ2008 - Boise, ID2008 - Investment Services Group, LA, CA2008 - Palm Desert, CA
2008 - Santa Barbara, CA2006 - Antelope Valley, CA2006 - Dallas, TX2006 - Madison, WI2006 - Oakland, CA2006 - Reno, NV2006 - San Diego - UTC, CA2006 - Ventura, CA2006 - San Luis Obispo, CA2005 - Southfield, MI
2005 - Los Olivos, CA2004 - Calabasas, CA2004 - St. Louis, MO2002 - Chicago, IL2001 - Victorville, CA1999 - Temecula Valley, CA1996 - Central LA, CA1994 - Sherman Oaks, CA1994 - West LA, CA1993 - Pleasanton, CA
1993 - Stockton, CA1992 - Las Vegas, NV1991 - Phoenix, AZ1990 - Carlsbad, CA1990 - Industry, CA1989 - Los Angeles, CA1989 - Riverside, CA1987 - Ontario, CA1984 - Newport Beach, CA1983 - Orange, CA
51LOCATIONS STRONG
www.lee-associates.com
NATIONAL PRESENCE
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