REOC San Antonio
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Kim_Gatley
Kim Gatley
S
enior Vice President & Director of Research at REOC San Antonio

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San Antonio’s industrial market maintains strong growth in first quarter

REOC San Antonio Outlines No AlamoAdd industrial to a strengthening sector of San Antonio’s real estate market. Following strong growth throughout 2014, the industrial market is primed to push vacancy rates downward and rents upward.

After evaluating more than 34.3 million square feet of industrial lease space, REOC San Antonio found that new leases and expansions inked in first quarter 2015 resulted in 376,707 square feet of positive net absorption. While rents fell by a slight $0.12 per square foot, the average rent is still $0.6 cents above the same quarter in 2014. Furthermore, REOC’s Senior Vice President and Partner John Turcotte said that market rents saw “pretty dramatic” increases last year, so rent growth is expected to be a bit slower this year as landlords evaluate tenants’ appetite for space at higher prices.

So which deals were the highlights of pushing San Antonio’s industrial market forward for the start of 2015? Here are some highlights:

  • FedEx moved into the newly completed 200,000-square-foot distribution FedEx Ground facility located at 9935 Doerr Lane in Schertz, located in the far northeast submarket of San Antonio’s metro area. Any positive absorption from this move however, may be offset when the shipping company vacates its current location at Industry Park later this year, unless that space is backfilled sometime between now and the move.
  • Menlo Logistics backfilled 132,000 square feet at the Tri-County Distribution Center IV building, 6417 Tri County Pkwy, which was vacated by CST Brands Inc. after its purchase of the Pearson Education facility last year.
  • Pearson Education backfilled more than 76,200 square feet at Green Mountain Business Park, 6550 N Loop 1604, following Avnet’s move to a new facility in Ridgewood Business Park last quarter.

And here are some projects that added to the San Antonio industrial market’s supply, subsequently offsetting some positive absorption during the first quarter:

  • Building I at the Alamo Ridge Business Park, 7007 Fairgrounds Pkwy: 96,324 square feet that came online 40 percent leased to two tenants. Shred It leased nearly 21,575 square feet and Welltec Inc. leased nearly 15,000 square feet of space.
  • Building II at Alamo Ridge Business Park, 7015 Fairgrounds Pkwy: 61,744 square feet came online with no pre-leasing reported.

Click to read entire article: San Antonio’s industrial market maintains strong growth in first quarter (San Antonio Business Journal, 05-18-15)

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