Greenville-Spartanburg Q4 Report
Feb 01, 2018 08:26AM
By Emily Stevenson
CBRE has released its Q4 2017 MarketView reports on the Greenville-Spartanburg industrial and office commercial real estate market.
Industrial & Logistics
After a record low vacancy rate in Q3, the delivery of speculative projects lifted Greenville-Spartanburg industrial vacancy by nine basis points to 6.8% in Q4, despite more than 2.4 million sq. ft. of absorption. Developers are being lured by a market that is experiencing accelerating growth and an increase in tenant diversity.
Highlights of the report are as follows:
- Vacancy rose by nine basis points due to speculative deliveries
- Tenant diversity is growing due to shift from manufacturing to manufacturing and logistics
- Large amounts of speculative development are occurring
- Speculative product is getting larger. Average size from 2002 to 2008 was 171,000 sq. ft. The average speculative building under construction is averaging more than 215,000 sq. ft.
The Greenville-Spartanburg office market has now experienced four consecutive quarters of underwhelming rates of absorption, or office market growth. Despite uncertainty in the engineering sector, tenants are confident in their long-term prospects, which raises the question as to exactly why things are slowing. Two primary issues appear to be driving a reduction in expansion: labor availability and the availability of space.
These are the highlights of the report:
- Absorption rate is slowing, but vacancy near record low
- Engineering sector brings uncertainty to the market
- Finding labor is a challenge for tenants
- Large spaces are difficult to find, new Camperdown project to help