Tampa Industrial Leasing Activity Slows Again as Local Demand Withers

TAMPA, FL--The overall pace of Tampa’s industrial leasing activity slowed again in the first period of 2008, breaking the market’s streak of thirteen consecutive quarters of positive absorption, according to the most recent market analysis by Randy Smith (top right photo), Director of Research in the Tampa office of GVA Advantis.

Market rents also lost some ground in the opening period, as local demand withered from the economic slowdown and companies grappled with an uncertain future.

Yet, Tampa’s industrial fundamentals remain well positioned to withstand a limited pullback. The direct vacancy rate closed the first quarter at a healthy 4.2 percent and the average asking rental rate was $7.13 per square foot, up about 3 percent over the same time last year.

At the end of the first quarter, industrial projects under construction in Tampa totaled 1.3 million square feet with almost 40 percent of the available space already committed.

Developers are pulling back from pure speculative starts, instead offering building pads or turnkey build-to-suit opportunities to kickoff new projects.

So far, the attraction of state-of-the-art first generation space is piquing sufficient interest from industrial users to keep new supplies in check.

Tampa’s industrial sales activity started the year relatively strong, posting $65.9 million in transaction volume for the first three months.

This sales mark is slightly ahead of last year’s pace at this time, but market conditions in 2008 could temper future activity as investors become more selective and try to discern the impact of reduced tenant activity on individual properties.

For a detailed copy of GVA Advantis' industrial market analysis, please contact:

Randy Smith, Director of Research, Advantis Real Estate Services Company, 3000 Bayport Drive, Suite 100, Tampa, FL 33607. Tel 813.342.4725. Fax 813.372.4004. E-mail rsmith@gvaadvantis.com
www.gvaadvantis.com