2Q
2011
3Q
2011
VACANCY
NET ABSORPTION
CONSTRUCTION
RENTAL RATE
MARKET REPORTNASHVILLE
www.colliers.com/Nashville
Market Gains Momentum, Forecast Positive
The industrial market in Nashville excelled this quarter. Absorption was positive 811,107 square feet, a drastic turn around from the negative 1,213,090 square feet of last year’s third quarter. The momentum the market has gained directly correlates with several deals inked this quarter. Amazon.com signed a lease for a 450,000 square-foot space at Park 840 in the East submarket. Other notable leases were for a 103,750 square-foot space in the Southeast submarket by TA Operating and a 100,800 square-foot space in the East by Hoffman Trucking Company.
Vacancy rates began to decrease to 11.5% from 12.3% from the past two quarters. The highest rates remain in the East and Southeast submarkets, with 17.9% and 15.2% respectively.
MARKET INDICATORS
3Q 2011 | INDUSTRIAL
Nashville Industrial MarketSummary of Statistics, Q3 2011
Vacancy Rate: 11.5%
Absorption: 774,327 SF
Under Construction: SF
Asking Rents Per Square Feet: Overall Rental Rates: $4.51Warehouse - Distribution: $4.06Light Industrial: $3.03Heavy - Mfg: $3.00Bulk Warehouse: $3.80Flex/R&D: $7.24
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
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
Q4.10 1,950 158,292,862 19,349,141 12.2% 1.7% (478,523) (1,450,577) 2,032,000 $4.18
Q3.10 1,950 158,329,421 19,201,016 12.1% 1.6% (1,231,090) (1,448,503) 186,809 $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
Warehouse - Distribution 1,052 49,128,785 5,411,379 11.0% 0.8% 92,556 (192,625) $4.06
Light Industrial 561 58,202,446 2,450,182 4.2% 0.6% 0 (161,771) $3.03
Heavy - Mfg 6 779,289 0 0.0% 0.0% 0 0 $3.00
Bulk Warehouse 99 39,051,163 8,362,085 21.4% 3.6% 699,428 1,271,688 $3.80
Flex/R&D 226 12,058,142 2,144,920 17.8% 1.2% 19,123 (192,625) $7.24
-
Updated 7-2011
Construction continues to grow with a couple of new projects in addition to several projects still underway. The 1,300,000 square-foot Nissan Battery Plant expansion is still in progress as well as the 1,500,00 sqaure foot Hemlock Semiconductor Plant expansion and the 30,000 square-foot Wirtgen Building expansion. Federated Department Stores completed its 375,000 square foot expansion this quarter and Ameriplex B added 135,800 square feet on space to the East submarket.
In addition to the positive absorption and lowering vacancy rates, more encouraging news came when GM announced that they would be reopening their Spring Hill assembly plant. The reopening will create an estimated 1,700 new jobs to the area and will boost the local economy.
Flex/R&D
Bulk Warehouse
Heavy - Mfg
Light Industrial
Warehouse - Distribution
2Q 2011 | Vacancy Space By Type
0
100000
200000
300000
400000
500000
Nort
h
Sou
thw
est
Wes
t
Sout
heas
t
East
IBD
2Q 2011 | Net Absorption By Submarket
RECENT SALES TRANSACTIONSSALES ACTIVITY
PROPERTY BUYER SALE PRICE SIZE SF SUBMARKET
Coucheville Pike Business Center Whiterock REIT $39,000,000 717,160 East
Pinchal Portfolio Exeter Property Group $22,500,000 603,547 North & Southeast
1650 Elm Hill Pike Buchanan Station Partners $2,300,000 41,000 East
RECENT LEASING TRANSACTIONSLEASING ACTIVITY
PROPERTY ADDRESS TENANT SIZE SF TYPE SUBMARKET
Park 840 Amazon.com 445,942 New East
501 Mason Road Computerland 307,200 Renewal Southeast
SouthPark B Nissan Trading 233,200 Renewal Southeast
Three Oaks Phase II TA Operating 103,486 New Southeast
935 Industrial Drive Hoffman Trucking Company 100,800 New East
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.
P. 2 | COLLIERS INTERNATIONAL
MARKET REPORT | Q3 2011 | INDUSTRIAL | NASHVILLE
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 306 26,287,369 3,776,605 17.9% 19.6% 0.6% 463,581 314,562 $3.99
Bulk Warehouses 29 12,852,289 82,000 29.4% 33.4% 0.0% 515,942 639,120 $3.09
Flex/R&D 42 1,846,881 280,052 15.2% 12.6% 0.3% (51,569) (94,999) $8.09
Light Industrial 88 5,305,384 82,000 1.5% 1.5% 0.0% 0 (62.000) $3.66
Warehouse - Distribution 147 6,283,815 575,285 9.2% 8.6% 2.3% (792) (167,559) $4.38
NORTH 451 39,888,721 2,991,563 7.5% 8.3% 2.0% 242,611 335,418 $3.58
Bulk Warehouses 19 6,995,658 662,790 9.5% 10.2% 6.2% 50,000 22,210 $3.01
Flex/R&D 40 1,580,142 232,888 26.9% 19.7% 0.0% 6,951 (1,914) $6.66
Heavy - Mfg 1 314,125 0 0.0% 0.0% 0.0% 0 - $3.00
Light Industrial 140 17,073,026 438,549 2.6% 2.6% 1.3% 0 46,897 $2.70
Warehouse - Distribution 251 13,925,770 1,657,336 11.9% 13.1% 1.1% 185,660 268,225 $3.12
SOUTHEAST 421 50,889,233 7,756,026 15.2% 16.1% 2.1% 71,053 359,694 $4.72
Bulk Warehouses 45 17,578,686 3,894,690 22.2% 24.6% 5.5% 133,486 638,358 $4.29
Flex/R&D 79 4,292,998 1,156,755 26.9% 26.9% 0.9% 36,619 (187,900) $6.51
Heavy - Mfg 3 149,990 0 0.0% 0.0% 0.0% 0 - -
Light Industrial 102 17,244,082 922,540 5.3% 5.5% 0.1% 0 - $3.45
Warehouse - Distribution 192 11,623,477 1,782,041 15.3% 15.0% 0.4% (99,052) (187,900) $4.45
SOUTHWEST 236 13,633,774 879,805 6.5% 6.6% 6.5% 11,502 46,334 $6.58
Bulk Warehouses 4 918,130 28,000 3.0% 3.0% 0.0% 0 (28,000) $4.50
Flex/R&D 43 3,406,164 337,739 9.9% 10.9% 0.0% 23,762 45,468 $8.50
Heavy - Mfg 1 100,000 0 0.0% 0.0% 0.0% 0 - -
Light Industrial 58 3,383,217 152,734 4.5% 4.6% 2.4% 0 - $2.59
Warehouse - Distribution 130 5,826,263 361,332 6.2% 6.0% 1.0% (12,260) 28,866 $4.87
WEST 125 10,581,561 779,987 7.4% 7.3% 0.0% 0 (146,277) $3.10
Bulk Warehouses 1 500,000 0 0.0% 0.0% 0.0% 0 - -
Light Industrial 53 7,480,503 708,559 9.5% 9.4% 0.0% 0 (159,935) $3.02
Warehouse - Distribution 71 2,601,058 71,428 2.7% 2.7% 0.0% 0 13,658 $3.48
IBD 406 17,939,167 1,247,243 7.0% 7.2% 0.6% 22,360 (135,404) $4.47
Bulk Warehouses 1 206,400 0 0.0% 0.0% 0.0% 0 - -
Flex/R&D 22 932,957 137,486 14.7% 15.1% 10.9% 3,360 (756) $6.91
Heavy - Mfg 1 215,174 0 0.0% 0.0% 0.0% 0 - -
Light Industrial 119 7,716,234 145,800 1.9% 1.9% 0.0% 0 13,267 $3.04
Warehouse - Distribution 263 8,868,402 963,957 10.9% 11.3% 0.0% 19,000 (147,915) $3.98
GRAND TOTAL 1,944 159,219,825 18,368,566 11.5% 12.3% 1.4% 811,107 774,327 $4.51
MARKET REPORT | Q3 2011 | INDUSTRIAL | NASHVILLE
COLLIERS INTERNATIONAL | P. 3
UNITED STATES:
NashvilleNate GreeneManaging Partner300 BroadwayNashville, TN, 37201TEL +1 615 850 2729FAX +1 615 850 3229
MARKETING DIRECTOR
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.
www.colliers.com/Nashville
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Affiliate Broker
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Affiliate Broker
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Partner
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ABOUT COLLIERS INTERNATIONAL – NASHVILLE Collier International Nashville is one of the largest full service commercial real
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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 2729
Managing Partner
MARKET REPORT | Q3 2011 | INDUSTRIAL | NASHVILLE
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