The warehouse market picked up steam in northern Delaware, according to a fourth-quarter report from the commercial real estate firm Newmark Knight Frank (NKF).
NKF has an office in Wilmington.
NKF reported that tenant activity picked up after a slow third quarter. The sector of the commercial market reported 144,920 square feet in positive absorption, lowering the vacancy rate by 13 percent to 7.3 percent.
With the increased activity, warehouse and R&D/flex lease rates both rose, moving up 26 cents to $4.81 per square foot and 25 cents to $6.08 per square foot, respectively. Overall rents in Delaware rose 10 cents $4.54 per square foot.
The combined markets in the Delaware Valley closed the fourth quarter with 2.2 million square feet of occupancy gains and 15.9 million square feet of positive absorption for the year.
Quarter-over-quarter, the combined vacancy rate stayed steady at 6.8 percent as the market, especially in southeastern Pennsylvania, remained tight.
Southeastern Pennsylvania’s vacancy rate remained at 6.8 percent for the sixth consecutive quarter. According to Eustace Wolfington, NKF senior managing director, “While activity in the market remains high, industrial sales and leasing is hampered by a lack of product. Build-to-suit opportunities exist, but for prospects with immediate needs, the timing is problematic.”
The Delaware market, which has struggled over the years with setbacks like the closing of both of state’s auto plants and downsizing of other employers, has seen little or no new product on the market until recently.
