Industrial Market Stabilizes in Northern Nevada
“Industrial real estate enters stable market,” reads the headline for a NNBW article earlier this week. The article pulled from our most recent Market Advisor, an industrial real estate report recapping the fourth quarter of 2015, with forecast and trending details as we enter 2016.
In addition to referencing the report itself, NNBW tapped Tom Miller for additional commentary. From the article:
“Coming out of the recession, it was marked by wild highs and lows,” Tom Miller, president of the company, said in a phone interview. Charts of quarterly numbers looked “like the Alps.” When looking at 2015 as a whole, the data generally follows the five-year averages. “We seem to be entering a stable period in balance between demand and supply,” he said. The region had an annual gross absorption of 5.1 million square feet for the year, on par with the five-year average of 5.4 million square feet, according to the report released Jan. 4. The annual inventory returned to the market from tenants leaving the area or moving to larger or smaller space was 3.4 million square feet, compared to the five-year average of 3.7 million. Net absorption for the year was 2.1 million square feet, which is higher than the five-year average of 1.6 million and reflects the declining vacancy rate. The report for the fourth quarter of 2015 shows the vacancy rate for the area as a whole stood at 9.13 percent for the fourth quarter, 7 percent lower than the third quarter vacancy rate of 9.89 percent, and 28 percent lower than the fourth quarter of 2014, which had a 12.82 percent vacancy rate. Breaking ground on new construction has again become commonplace as investors and developers are comfort- able enough with market conditions to invest in a steady supply of new Class A warehouse buildings, which is the product of choice for many new firms enter the market, according to the Market Advisor report.