VOIT REPORTS POSITIVE NET ABSORPTION AND DROP IN VACANCY IN SACRAMENTO INDUSTRIAL AND RETAIL MARKETS
Industrial market in Sacramento posted nearly 1.4 million square feet of positive absorption over the past four quarters.
Sacramento’s retail rents grew by 2.21 percent in Q1 from the previous quarter, and vacancy dropped below 10 percent for the first time since 2009.
Sacramento, CA – April 26, 2012 – (RealEstateRama) — In the first quarter of 2012, the Sacramento industrial market posted 673,501 square feet of positive net absorption, giving the market a total of nearly 1.4 million square feet of positive absorption over the past four quarters. In addition, the vacancy rate for the region’s retail market decreased to 9.94 percent – the first sub-ten percent vacancy rate in this market in ten quarters, according to a First Quarter Market Report by Voit Real Estate Services.
“These numbers are moving in the right direction, and there is room for optimism as 2012 progresses,” said Kevin Sheehan, Managing Director of Voit’s Sacramento office. “While these are all positive indicators, stability and job growth will need to be sustained in order for the market to continue its recovery.”
Positive Absorption and Increased Occupancy Means Demand is Improving in Sacramento’s Industrial Market
In addition to positive net absorption, industrial vacancy and availability continued to descend in Sacramento during Q1. Vacancy decreased by 45 basis points from the fourth quarter of 2011, coming in at 11.9 percent. This is the first time industrial vacancy has dipped below 12 percent since the first quarter of 2010.
Availability for both direct and sublease space was at 16.33 percent at the close of the first quarter, down from 17.19 percent in the fourth quarter of 2011.
The average asking triple-net lease rate ended the quarter at $0.35, unchanged from the previous quarter.
“The good news is that industrial rent losses are finally over,” said Sheehan. “The demand for warehouse space is improving, and we will see a rise in that demand as home building picks up and as local incomes begin to rise.”
Retail Rents Growing Steadily
Retail vacancy rates reached their lowest point in more than two years during the first quarter of 2012, driving upward momentum for the market’s lease rates. The average asking triple-net lease rate in the Sacramento retail market was $1.39 in the first quarter of 2012, an increase of $0.03 from the previous quarter.
“Even in light of its ongoing challenges, Sacramento’s retail market has proven to be the best-performing sector in our region’s commercial real estate market,” commented Sheehan.
The retail market posted 167,724 square feet of positive net absorption in 2012’s first quarter, and availability dropped to 11.13 percent, a decrease of more than four percent year over year.
“While the growth in retail rents remains slow and steady, we expect to see further stabilization in this market throughout the coming year,” said Sheehan.
About Voit Real Estate Services
Voit Real Estate Services is now a 10-office commercial real estate firm that, through its brokerage and asset services professionals working together, provides strategic property solutions tailored to clients’ needs. Combining 40 years of expertise in brokerage, investment advisory, financial analysis, market research, asset management, tenant advisory and property management services, Voit provides clients with forward looking strategies that create value for their assets and portfolios.
Voit is a privately held, debt-free firm that has successfully navigated numerous market cycles since 1971 and currently employs more than 250 people. Voit has owned, developed and managed over 50 million square feet of commercial real estate, participated in $1.4 billion of construction projects and completed over $36 billion in brokerage transaction volume. Further information is available at www.voitco.com
Contact:
Jenn Quader/ Judith Brower
Brower, Miller & Cole
(949) 955-7940
JQuader (at) browermillercole (dot) com
