Industrial Research

Employment Trends
Metro United States
6%
Portland Office:

Year-over-Year Change
3%

Market Report
Adam A. Lewis Vice President/Regional Manager
111 S.W. Fifth Avenue, Suite 1550 0%
Portland, OR 97204
-3%
Second Half 2018
(503) 200-2000| adam.lewis@marcusmillichap.com
West Palm Beach Metro Area -6%
08 09 10 11 12 13 14 15 16 17 18*
Raleigh Office: Seattle Office:
Vacancy Among the Lowest in the Nation, Boosting
Benjamin Yelm Regional Manager Joel DeisIndustrial
Vice President/Regional
Supply andManager
Rent Growth; Keeping Investor Interest
101 J Morris Piqued
Commons Lane, Suite 130 Two Union Square,
Demand
601 UnionAbsorption
Completions
Street, Suite 2710
Vacancy
Morrisville, NC 27560 Seattle, WA 98101
2 16%
Already-tight vacancy and a slow (919) 674-1100 | benjamin.yelm@marcusmillichap.com
construction pipeline will keep available (206) 826-5700 | joel.deis@marcusmillichap.com

Square Feet (millions)

space limited. Steady demand in Palm Beach County’s relatively small industrial sector 1 12%

Vacancy Rate
has compressed vacancy over the pastOntario
nine years to one of the tightest among U.S.
Office: St. Louis Office:
0 8%
metros. This trend coupled with few deliveries scheduled in 2018 will drop the vacancy
Cody Cannon
rate to a cyclical low by year end. The vacancy Regional Manager
rate is especially restricted in areas of Richard
-1
Matricaria Senior Vice President/Division Manager
4%
3281 East Guasti Road, Suite 800 7800 Forsyth Blvd., Suite 710
high demand, resting under 1 percent in the Lewis
Ontario, CATerminals
91761 and Electronics Way neigh- St. Louis, MO 63105
-2 0%
borhoods. Leasing this year has been led(909)
by technology firms and companies servicing
456-3400 | cody.cannon@marcusmillichap.com (314) 889-2500 | richard.matricaria@marcusmillichap.com
08 09 10 11 12 13 14 15 16 17 18*
the area’s growing population. The net migration of 38,000 people into the market during
the past 12 months and the expansion of e-commerce, are generating the need for
Asking Rent Trends
additional distribution and warehouse space. The demand for available industrial space
Sacramento Office: Tampa Office: Metro United States
has underpinned a 30 percent surge in the average asking rent since the end of 2013,
20%
with further rent growth expected throughRyan
year DeMar
end. Vice President/Regional Manager Ari Ravi Regional Manager

Year-over-Year Change
3741 Douglas Blvd., Suite 200 201 North Franklin St., Suite 1100
10%
Roseville, CA 95661 Tampa, FL 33602
Robust property performance luring buyers to metro. A number of investors seek-
(916) 724-1400 | ryan.demar@marcusmillichap.com (813) 387-4700 | ari.ravi@marcusmillichap.com
0%
ing lower entry costs and higher yields than nearby Miami-Dade are searching for assets
in Palm Beach County. The market’s favorable economic growth attracts a wide range -10%
of buyers. Deal flow held steady year over Salt Lake
year City limited
in June, Office:by the supply of for-sale Toronto Office:
-20%
assets. Strong investor demand helped drive the average price up 12 percent during the
Phil Brierley Regional Manager Mark A. Paterson
08 09 10 11 12 13 14 15 16 17 18*
period to $132 per square foot, while first-year returns
111 South Main compressed 20 basis points, with
Street, Suite 500 Broker of Record | Regional Manager
the average falling below 7 percent, the Salt
lowest
Lakelevel in 18
City, UT years. Warehouses with less
84111 20 Queen Street W, Suite 2300
than 50,000 square feet were often sought (801)after.
736-2600
Class | phil.brierley@marcusmillichap.com
C warehouses changed hands Toronto, ON M5H 3R3Sales Trends
(416) 585-4646 | mark.paterson@marcusmillichap.com
Sales Price Growth
at an average approaching $110 per square foot, with cap rates in the low-6 to low-8
Average Price per Unit (000s)

percent range. $160 40%

Year-over-Year Growth
San Antonio Office: Vancouver
$120
Office: 20%

Craig R. Swanson Vice President/Regional Manager Rene

$80
H. Palsenbarg 0%
8200 IH 10 W, Suite 603 Broker of Record | Regional Manager
San Antonio, TX 78230 400 Burrard
$40
Street, Suite 1020 -20%
(210) 343-7800 | craig.swanson@marcusmillichap.com Vancouver, BC V6C 3A6
2018 Market Forecast (604) 675-5200
$0
| rene.palsenbarg@marcusmillichap.com
-40%
Employment Employers will expand staffs by 1.6 percent or 10,000 workers 08 09 10 11 12 13 14 15 16 17 18**

up 1.6% in 2018, roughly doubling last year’s job growth.

San Diego Office: Washington, D.C., Office:
Construction Completions fallKent
to less
R.than
Williamshalf ofSenior
lastVice
year’s 627,000 Manager
President/Regional square Matthew Drane Regional
* Forecast ** Trailing 12 months Manager
through 2Q
213,000 sq. ft. feet. Projects are4660 La Jolla throughout
scattered Village Drive, Suite
the 900
county with only one 7200 Wisconsin
Sources: Avenue,
Marcus & Millichap Suite 1101
Research Services;
Bureau of Labor Statistics; CoStar Group, Inc.; Real Capital Analytics
San Diego, CA 92122 Bethesda, MD 20814
building larger than 60,000 square feet.
(858) 373-3100 | kent.williams@marcusmillichap.com (202) 536-3700 | matthew.drane@marcusmillichap.com

Vacancy The slow delivery pace will assist in moving vacancy down 60
down 60 bps basis points to San
2.5 percent
Franciscoon Office:
the net absorption of roughly West Palm Beach Office:
492,000 square feet. Last year, vacancy fell 90 basis points.
Ramon Kochavi First Vice President/Regional Manager Ryan Nee First Vice President/Regional Manager
750 Battery Street, Fifth Floor
5900 North Andrews Ave., Suite 100
Rent Asking rent will climb an average
San Francisco, CA 94111 of 4.9 percent to $10.45 per Fort Lauderdale, FL 33309
up 4.9% square foot (415) 963-3000
in 2018, building |on
ramon.kochavi@marcusmillichap.com
a 3.4 percent gain last year. (954) 245-3400 | ryan.nee@marcusmillichap.com

Investment Vacancy above the metro average and robust rent gains should For information on national industrial trends, contact:
attract buyers toSan
the Jose
ArvidaOffice:
Park of Commerce area for assets John
RenoChang
Office: Senior Vice President | Research Services
with some upside potential. Tel: (602) 707-9700 | john.chang@marcusmillichap.com
Steven J. Seligman First Vice President/Regional Manager Ryan DeMar Vice President/Regional Manager
2626 Hanover Street
Metro-level employment, vacancy and asking rents are year-end figures and are based on the most up-to-date information available. Asking rent50 W. Liberty
is based St.,service
on the full Suitemarketed
400 rental rate. Average prices and cap
Palo Alto, CA 94304
rates are a function of the age, class and geographic area of the properties trading and therefore may not be representative of the market as a whole.
Reno,Sales
NV data
89501includes transactions valued at $1,000,000 and greater
unless otherwise noted. Forecasts for employment and office (415) 963-3000 | ramon.kochavi@marcusmillichap.com
data are made during the fourth quarter and represent estimates of future performance. No representation, warranty or guarantee, express or implied may be
made as to the accuracy or reliability of the information contained herein. This is not intended to be a forecast of future events and this is not a (775) 348-5200
guaranty regarding a| future
ryan.demar@marcusmillichap.com
event. This is not intended to provide specific
investment advice and should not be considered as investment advice.

© Marcus & Millichap 2018 | www.marcusmillichap.com