INDUSTRIAL MARKET REPORT
Orlando 2nd Quarter 2016 2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
Table of Contents/ Methodology of Tracked Set Xceligent is a leading provider of verified commercial real estate information which assists real estate professionals, appraisers, owners, investors and developers that make strategic decisions to lease, sell, buy and develop commercial properties.
Table of Contents and Methodology/Map
2-3
Market Overview
4-5
Statistics by Market Vacancy Rates & Asking Rates
6 7-8
Leasing & Absorption
9
Industrial Advisory Board Members
10
Xceligent Team
11
The Orlando tracked set consists of an inventory of buildings considered to be competitive by the brokerage community. All buildings within the competitive tracked set have been reviewed and verified by members of the Advisory Boards for the market area. Inventory
The total square feet of all existing single-tenant, multi-tenant and owner-occupied industrial properties greater than 10,000 SF.
Total Available SF
All of the available leasable space within a building, whether it is occupied or vacant, for direct lease or sublease space. Space can be available but not vacant, for example, if the landlord, or his agent, is marketing space that will be coming available at a future date because a tenant is planning to move.
Total Vacant SF
The total of all of the vacant square footage within a building, including both direct and sublease space.
Direct Vacant SF
The total of the vacant square footage in a building that is being marketed by an agent representing the landlord.
Sublease SF
Space that is offered for lease by a current tenant, or his agent, within a property. Whether the tenant is paying rent or not, the space is considered vacant only if it is unoccupied.
Net Absorption
The net change in physically occupied space from quarter to quarter, expressed in square feet.
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
2
Industrial Market Map
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
3
Orlando Industrial Overview
Overview
The unemployment rate in the Orlando MSA was 4.0% in May 2016. This rate was 1.2 percentage points lower than the region's rate a year ago, of 5.2%.
At 7.0%, the regional vacancy rate is down 0.4 percentage points from the first quarter of 2016 and net absorption was recorded at positive 772,961 square feet.
The Airport South/Lake Nona submarket experienced the strongest leasing activity during the second quarter and the top lease transaction was Thyssen Krupp's new 79,300 square foot requirement at LeeVista Business Center Bldg F.
One notable sale transaction during the quarter was reported at Shader Industrial Park - 2515 Shader Rd, a 302,420 square foot building, and was purchased for $10,700,000.
# of Bldgs
Inventory (SF)
Total Available (SF)
Total Vacant (SF)
Total Vacancy Total Quarterly Net Rate (%) Absorption (SF)
YTD Total Net Absorption (SF)
Flex/R&D
735
22,790,369
2,695,467
2,284,832
10.0%
175,143
200,937
Warehouse - Distribution
727
64,740,889
7,108,931
5,740,393
8.9%
569,169
767,689
Light Industrial
1,583
33,920,568
1,680,378
1,248,368
3.7%
40,566
36,452
Manufacturing
106
8,939,784
282,316
193,916
2.2%
-3,600
31,350
73
6,331,310
159,030
110,530
1.7%
-8,317
-17,317
3,224
136,722,920
11,926,122
9,578,039
7.0%
772,961
1,019,111
# of Bldgs
Inventory (SF)
Bulk Warehouse Grand Total
Sum of Direct Available SF
Direct Vacant (SF)
Direct Vacancy Direct Quarterly Net Rate (%) Absorption (SF)
YTD Direct Net Absorption (SF)
Flex/R&D
735
22,790,369
2,670,120
2,265,985
9.9%
154,881
237,296
Warehouse - Distribution
727
64,740,889
6,810,873
5,682,595
8.8%
561,969
554,399
Light Industrial
1,583
33,920,568
1,680,378
1,248,368
3.7%
40,566
36,452
Manufacturing
106
8,939,784
218,303
129,903
1.5%
-3,600
31,350
73
6,331,310
157,030
108,530
1.7%
-8,317
-17,317
3,224
136,722,920
11,536,704
9,435,381
6.9%
745,499
842,180
# of Bldgs
Inventory (SF)
Sublease Vacancy Rate (%)
Sublease Quarterly Absorption (SF)
YTD Sublease Net Absorption (SF)
Bulk Warehouse Grand Total
Available Sublease (SF)
Sublease Vacant (SF)
Flex/R&D
735
22,790,369
25,347
18,847
0.1%
20,262
-36,359
Warehouse - Distribution
727
64,740,889
298,058
57,798
0.1%
7,200
213,290
Light Industrial
1,583
33,920,568
-
-
0.0%
-
-
Manufacturing
106
8,939,784
64,013
64,013
0.7%
-
-
73
6,331,310
2,000
2,000
0.0%
-
-
3,224
136,722,920
389,418
142,658
0.1%
27,462
176,931
Bulk Warehouse Grand Total
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
4
Orlando Industrial Overview
Historical Vacancy Rate & Net Absorption 1,200,000
9.0% 8.0%
1,000,000
7.0%
800,000
6.0% 5.0%
600,000
4.0%
400,000
3.0% 2.0%
200,000
1.0%
-
0.0% 2015 Q2
2015 Q3
2015 Q4
2016 Q1
2016 Q2
Historical Vacancy Rates by Use 12.0%
9.0%
6.0%
3.0%
0.0% 2015 Q2 Flex/R&D
2015 Q3
2015 Q4
Warehouse - Distribution
Light Industrial
2016 Q1
2016 Q2
Manufacturing
Bulk Warehouse
Historical Net Absorption by Use 950,000 750,000 550,000 350,000
150,000 (50,000)
2015 Q2 Flex/R&D
2015 Q3 Warehouse - Distribution
2015 Q4 Light Industrial
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
2016 Q1 Manufacturing
2016 Q2
Bulk Warehouse
5
Statistics by Market
# of Bldgs
Inventory (SF)
Total Vacant (SF)
Sublease Vacant (SF)
Vacancy Rate (%)
Total Quarterly Absorption
YTD Total Net Absorption (SF)
Southeast Submarket
418
25,754,591
2,439,819
64,013
9.5%
-165,095
-95,707
Orlando Central Park
288
22,048,865
992,222
18,847
4.5%
463,421
651,346
Silver Star
521
20,002,819
1,082,906
59,798
5.4%
119,134
124,861
North Seminole
356
12,133,590
1,462,784
-
12.1%
223,074
248,701
Northwest Outlying
249
9,063,023
209,627
-
2.3%
-9
-10,388
Longwood / Altamonte
351
8,273,226
677,255
-
8.2%
-35,604
-60,109
Eastside University
244
7,853,902
540,566
-
6.9%
-30,421
-24,309
Kissimmee - St Cloud
175
7,266,740
212,446
-
2.9%
65,331
122,356
Downtown Orlando
266
7,121,799
300,067
-
4.2%
51,143
97,183
Airport South / Lake Nona
110
6,924,411
1,027,049
-
14.8%
62,047
34,969
33rd Street
133
5,854,861
440,178
-
7.5%
19,940
51,538
Southwest Outlying
46
2,424,592
-
-
0.0%
-
2,400
Winter Park
60
1,292,869
44,320
-
3.4%
-
-3,730
7
707,632
148,800
-
21.0%
-
-120,000
3,224
136,722,920
9,578,039
142,658
7.0%
772,961
1,019,111
Regency
Grand Total
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
6
Vacancy Rates & Asking Rates
Vacancy Rate %
Average Weighted Direct Asking Rate
2015 Q2
2015 Q3
2015 Q4
2016 Q1
2016 Q2
2015 Q2
2015 Q3
2015 Q4
2016 Q1
2016 Q2
5.1%
4.5%
4.6%
3.8%
2.9%
$4.04
$4.09
$4.45
$4.67
$4.83
-
-
0.1%
-
-
-
-
-
-
-
Southeast Submarket
8.4%
8.5%
8.2%
8.8%
9.5%
$4.73
$4.85
$4.79
$4.92
$4.97
Orlando Central Park
7.1%
6.8%
7.4%
6.6%
4.5%
$6.18
$4.96
$5.19
$5.58
$5.48
Regency
4.1%
4.1%
4.1%
21.0%
21.0%
$3.34
$3.50
$3.50
$3.50
$3.95
11.2%
9.9%
9.5%
13.9%
14.8%
$6.95
$6.60
$6.30
$6.37
$6.01
Downtown Orlando
7.0%
6.5%
5.6%
4.9%
4.2%
$4.86
$5.11
$5.46
$6.59
$8.74
33rd Street
9.1%
7.9%
8.4%
7.9%
7.5%
$5.49
$5.56
$5.52
$7.32
$7.34
Silver Star
6.2%
5.9%
5.8%
5.8%
5.4%
$5.97
$5.85
$5.95
$6.11
$5.93
Eastside University
6.7%
6.4%
6.6%
6.5%
6.9%
$8.38
$8.88
$8.88
$8.63
$8.35
Northwest Outlying
3.9%
3.1%
2.2%
2.3%
2.3%
$5.49
$5.52
$6.53
$7.72
$5.04
Winter Park
5.0%
4.7%
3.1%
3.4%
3.4%
$8.61
$8.45
$7.30
$7.73
$7.81
Longwood / Altamonte
9.8%
8.8%
7.5%
7.8%
8.2%
$6.55
$6.49
$6.66
$6.68
$6.70
14.2%
14.3%
14.1%
13.9%
12.1%
$5.36
$5.08
$5.66
$5.48
$5.42
7.8%
7.4%
7.2%
7.4%
7.0%
$5.66
$5.42
$5.54
$5.82
$5.75
Kissimmee - St Cloud
Southwest Outlying
Airport South / Lake Nona
North Seminole
Grand Total
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
7
Vacancy Rates & Asking Rates
Vacancy Rate by Submarket 21.0% 14.8%
12.1%
9.5%
2.9%
4.5%
4.2%
7.5%
5.4% 6.9%
0.0%
8.2% 2.3% 3.4%
Average Weighted Asking Rates by Submarket $8.74
$8.35
$7.34
$4.83
$4.97
$5.93
$3.95
$5.04
$6.70 $5.42
Asking Lease Rate Range by Type (NNN)
$24.00
$21.00
$6.01
$5.48
$7.81
$21.77
$18.00 $15.00
$14.55
$15.00
$12.00 $9.00
$8.52
$6.00 $3.00
$3.50
$4.89 $2.97
$5.88 $2.50
$Flex/R&D
Warehouse Distribution
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
Light Industrial
$6.00 $3.46 $2.75 Manufacturing
$6.90 $5.79 $4.50 Bulk Warehouse
8
Leasing & Absorption
Top Lease Transactions Property Name
Submarket
Tenant Name
Leased SF
Deal Type
LeeVista Business Center Bldg F
Airport South / Lake Nona
Thyssen Krupp
79,300
New
Prologis Lake Mary Logistics Center
North Seminole
Irby
60,500
New
Liberty Park at AIPO
Airport South / Lake Nona
Shaw
55,840
Expansion
450 Gills Dr
Southeast Submarket
Bridgestone
43,120
New
Prologis Crown Pointe Park
Orlando Central Park
Shell
42,354
New
2900 Titan Row
Orlando Central Park
Trojan Battery Sales
31,500
New
LeeVista Business Center Bldg F
Airport South / Lake Nona
Zenith Lighting
26,500
New
Top Sale Transactions Property
Buyer
Shader Industrial Park - 2515 Shader Rd
Hanover Platinum LLC
Orlando Shader Realty Associates Ltd $10,700,000
302,420
200 Tech Park
RCS - Tech Park LLC
Sun Life Assurance Company of Canada $21,300,000
297,778
3122 Shader Rd South Building
3122 Shader Road Investors LLC
Cawley O'Dell Enterprises Inc et al
$6,300,000
124,587
7466 Chancellor Dr
The Realty Associates Fund XI LP
Chancellor Realty LLC
$6,850,000
103,501
515 Ferguson Dr
Kars Properties Inc
515 Ferguson Drive LLC
$1,500,000
80,287
11250 Astronaut Blvd South Bldg
Lawrence B Stone Properties #800 LLC
Steel Construction Systems
$1,611,000
60,373
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
Seller
Sale Price Square Feet
9
Industrial Advisory Board Members
Orlando Avison Young
Lisa Bailey
CBRE
David Murphy
Cite Partners
Matt Sullivan Wilson McDowell
Foundry Commercial LLC
Justin Ruby
DCT Industrial
Eric Penaranda
Mike Borling Eastgroup Properties Lisa Wilde
Tom McFadden Lee & Associates Bo Bradford
Colliers International
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
Lee Morris
10
Xceligent Orlando Team
This information has been obtained from sources believed reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy. For more information, please contact :
Stephen Keith
Director of Analytics
(813) 601-4901
[email protected]
Brian Reece
Regional VP of Analytics Eastern Region
(919) 829-9627
[email protected]
Danny Rice
Regional VP of Sales Florida
(407) 562-8094
[email protected]
David Vaden
Director of Client Services
(540) 537-9130
[email protected]
Quentin Jackson
Director of Client Services
(407) 267-5831
[email protected]
Lynda McNally
Director of Financial Services
(727) 463-2895
[email protected]
2016 Q2 Market Trends © 2016 by Xceligent, Inc. All Rights Reserved
11