Posts tagged Review & Forecast
NAI DESCO Quarterly Industrial Report Now Available
Feb 17th
After minimal shifts in the early portion of the year, the industrial market showed improved net absorption through the end of 2010. Less than 200,000 SF of new industrial space was delivered in the current year, a historic low, which assisted in absorption gains. The combination of increased absorption and lack of new construction lowered the industrial vacancy rate in the St. Louis metro area nearly three percentage points over the past year, from 10.6% at the end of 2009 to 7.9% at the end of 2010.
Vacancy rates in both flex space and warehouses have trended downwards, and overall vacancy in St. Louis is approximately two percentage points lower than in the United States as whole.
Rental rates in the industrial market have hovered steadily around $4.20 per square foot for the past year, with little upwards or downwards movement.
Click here to read our full St. Louis metro industrial report, featuring detailed submarket information and major transactions from the quarter.
NAI DESCO Quarterly Retail Report Now Available
Jan 31st
The metro St. Louis retail commercial real estate market is looking better at the end of 2010 than it did a year ago. Vacancy rates continue to decrease and are down to 8.1% from 9.0%. However, weak demand and a troubled economy continue to create a downward pressure on average asking rates, which have dropped from $13.22 per square foot at the end of 2009 to $12.51 per square foot at the end of 2010.
Net absorption in the fourth quarter was positive 340,000 square feet, continuing a trend of positive net absorption through the entirety of 2010. Very little square footage was delivered to the market in 2010 compared to 2009, so the combination of ongoing positive absorption and minimal new deliveries to the market should promote a continued downward trend in the vacancy rate moving into 2011.
Click here to read our full St. Louis metro retail report, featuring detailed submarket information and major transactions from the quarter.
NAI DESCO Quarterly Office Report Now Available
Jan 27th
Overall, 2010 was a difficult year for office landlords. Sluggish demand placed downward pressure on rental rates and the limited pool of potential tenants were in a position to obtain lease concessions. Office tenants also faced a challenging year, wanting to reduce space if possible or avoid signing new long-term leases until the economy attained a greater degree of stability. Landlords and tenants reached a compromise with the “blend and extend” method, earning extended leases for landlords and rent concessions for tenants.
The office vacancy rate at the end of 2010 was 11.4%, showing a slight improvement over the 11.8% vacancy rate at the end of 2009. A bright note in the St. Louis market was Clayton’s ability to absorb most of the 485,000 SF Centene building with little change in the Clayton vacancy rate, indicating better market conditions for Class A space than in the overall office market.
Over the entire metro St. Louis market, asking rates at the end of 2010 were $18.65 compared to $18.35 at the end of 2009, suggesting the market may be starting to look brighter for landlords moving into 2011.
Click here to read our full St. Louis metro office report, featuring detailed submarket information and major transactions from the quarter.
St. Louis Market Review & Forecast
Dec 13th
The following is an excerpt from Principal John Sheahan’s market review & forecast article featured in the December issue of the Heartland Real Estate Business magazine:
As evidenced by data from the Federal Reserve’s October 2010 Burgundy Book, the St. Louis market area has experienced a small but steady increase in economic activity through the latter portion of the year. The St. Louis area is aided in this respect by its diversification in sectors such as bioscience, information technology, financial services, transportation/distribution and high-tech manufacturing. Local market indicators mirror an overall national trend towards improvement in these areas.
