In Q1, the Triangle warehouse market posted solid absorption levels for the second consecutive quarter while vacancy declined to historical levels. First quarter absorption totaled 246,292 square feet (sf) and was slightly higher than the five-year quarterly average of 231,313 sf. Overall vacancy declined to a historical low of 7.1% given solid absorption levels, no new deliveries and competitive rental rates. In Q1, market-wide rental rates were $5.36 per square foot (psf) and showed solid year-over-year growth of 7.4%.
The Triangle’s flex market started 2019 off strong with robust leasing activity and a declining vacancy for the fifth consecutive quarter. In Q1, absorption totaled more than 128,000 sf and vacancy declined to 6.9%, further solidifying the markets historical low. Average rental rates in the flex market were $12.04 psf and posted solid growth of 5.6% year-over-year. New construction has been a non-factor in the past, but with steady demand for flex space putting downward pressure on vacancy rates, new developments could be on the horizon.
Below are Five Fast Facts about Raleigh-Durham’s industrial market.