Rebman Reports Service Center/Flex Leasing Vacancy at 15.22%

The third-quarter market report by the Winter Park-based firm shows condominium industrial sales posted positive absorption of 36,849 SF

ORLANDO, FL--This survey covers 9,007,669 square feet of service center/flex space in 106 locations south of the 408 Expressway in Orlando, Florida.

Lyle N. Nelsen (top right photo), Rebman's corporate and industrial specialist, notes the overall results of sales and leasing activity in the third quarter continues to pause while the economy turns around.

The negative absorption this quarter of 71,627 square feet and a 15.22% vacancy are strong indicators of this pause in the economy. The year to date negative absorption of 69,800 is a distinct slow down in leasing and sales activity.

The number of third quarter leases over 5,000 square feet were less than normal for this market. They included:

--Oceaneering Intern. 20,000 sf, Southridge II, Leasing Agent Mike Borling-EastGroup.

--Kranson Industries, 9,600 sf, Beachline Comm. Center, Agent Todd Watson of Liberty Properties.

--Serv Pro, 8,000 sf, Sunport Comm. Center, Quentin Caruso of Realty Capital.

Surprisingly, condominium sales had a positive absorption of 36,849 square feet, reducing the condo vacancy rate from 14.10% to 11.08%.

Asking prices have dropped to an average range of $100 to $110 per square foot which produced a number of small space sales.

Summarizing this service center/flex space market, it is in transition and will turn around when there is stability in the financial sector.

There have been only three years when the vacancy rate was higher than the current 15.22% -- 1991 (25.7%); 1992 (21.85%) and 1994 (15.95%).

Rental rates along the core area of Sandlake Road and South Orange Blossom Trail are holding. Asking rates have been reduced in the outlining area along the Beltway.

There is very little movement of tenants. Most tenants are remaining with a lot of downsizing.

Deals are predominantly in the smaller spaces and with short terms – 1 to 3 years. There is a trend of smaller tenants leaving without notice.

Finally, when brokers are in a competitive situation, free rent is the main tool they use to get the deal.

The forecast – more of the same through this year and into 2009 until the financial markets open the gates. In the meantime, this market has an abundance of flex space in all areas of the south Orlando – ready for occupancy!
This survey has been produced every quarter since 1986 with a personal call to each broker/property manager in gathering this information.

CONTACTS:

Lynn G. Bailey, Rebman Properties Inc., PH 407 875 8001. FX 407 875 8004. lynn@rebmanproperties.com

Lyle N. Nelsen, corporate/industrial specialist, Rebman Properties Inc., lyle@rebmanproperties.com

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Rebman Reports Existing Warehouses in Orlando Doing Better Than New Construction

WINTER PARK, FL--Rebman Properties Inc. reports Orlando’s bulk warehouse leasing market in the third quarter was quiet for the fifth consecutive quarter.

There was 23,245 square feet of net absorption in the 133 surveyed buildings.

"Leasing was nearly at a standstill, although tenants continue to renew at their current locations," says Rebman principal Greg Rebman (top right photo). "As a result, existing warehouses are doing better than new construction."

The largest leases for the third quarter were as follows:

Air Traffic Services leased 55,000 s.f. at Liberty Park @ AIPO, Building B;
Scientific Games Corporation leased 45,000 s.f. at Liberty Park @ AIPO, Building B; and
Tommy Hilfiger leased 12,745 s.f. at Exchange I in Orlando Central Park.

Supply

The vacancy rate dropped slightly from 13.90% at end of the second quarter to 13.76% at the end of the third quarter. There were no new buildings added to the survey in the third quarter, but several will be added in the next two quarters.

"Another factor that does not bode well for the market is that there are a rising number of spaces being offered for sublease," notes Rebman. "These spaces will, of course, compete with space offered for direct lease."

Rental Rate

The average quoted rental rate for the 133 buildings surveyed is $4.67 psf triple net, which is unchanged from the second quarter.

Construction

Lincoln International Corporate Park’s Building C will be completed in October. Building C is a 141,660 s.f. facility.

Beltway Distribution is under construction at the intersection of Lee Vista Boulevard and Highway 417 (The Greenway). Slated for completion in January 2009, Building #100 is a 141,810 s.f., rear-load facility; Building #200 is a 145,540 s.f., rear-load; and Building #400 is a 378,600 square foot, cross-dock facility.

Forecast

Rebman says Orlando industrial brokers expressed that tenants are in a “wait-and-see” mode as a result of the volatility and uncertainty in the financial markets.

Existing tenants are continuing to renew at their current locations and as a result, vacancy rates have only been edging up slightly over time. A number of large tenant prospects have been circulating in the market since the beginning of the year, but most have not committed to leases as yet.

CONTACTS:

Greg Rebman, SIOR, CCIM, Rebman Properties Inc., 407 875 8001

Lynn G. Bailey Rebman Properties, Inc., a CORFAC International Member, 1014 W. Fairbanks Ave/ , Winter Park, FL 32789 USA. Tel: 407.875.800. Fax: 407.875.8004 lynn@rebmanproperties.com
Corporate Facility Advisors Associated Globally with KingSturge

Orlando's Bulk Warehouse Leasing Market Quiet

ORLANDO, FL--Rebman Properties Inc. reports Orlando’s bulk warehouse leasing market was quiet for the fourth consecutive quarter.

"In fact, the second quarter was nearly a mirror image of the first," Says Greg Rebman, (top right photo) Vice President of the Winter Park, FL-based real estate company.

There was 111,892 square feet of net absorption in the 133 surveyed buildings (the first quarter had an almost identical absorption of 111,876 square feet).

The half-dozen or so large tenant prospects of 100,000 or more that were circulating the market in the first quarter have yet to land anywhere.

The largest leases for the second quarter were as follows:

Dusobox leased 55,000 s.f. at 1350 Tradeport Drive in AIPO; Europa Sports Products leased 38,994 s.f. at Crownpointe VI; and Brand Connections leased 33,600 s.f. at Sand Lake West 1.

The vacancy rate rose from 12.75% at the end of the first quarter to 13.90% at end of the second quarter. One new building was added to the survey: Beachline Corporate Center, Building 100, a 360,000 square foot, cross-dock facility at International Corporate Park. Vacancy rates continue their steady rise since their low of 5.37% at the end of the second quarter, 2004.

The average quoted rental rate for the 133 buildings surveyed is $4.67 psf triple net, virtually unchanged from the average of $4.66 psf triple net at the end of the first quarter, and $4.65 psf at year-end, 2007.

Beltway Distribution is under construction at the intersection of Lee Vista Boulevard and Highway 417 (The Greenway). Slated for completion in November, Building #100 is a 141,810 square foot, rear-load facility; Building #200 is a 145,540 square foot, rear-load; and Building #400 is a 378,600 square foot, cross-dock facility.

Forecast

Orlando industrial brokers generally expressed that the market is quiet, but that renewals are strong. Tenants are tending to stay put so that buildings entering this period with high occupancy rates are keeping their tenants, but new buildings and those with vacancy are struggling to land tenants.

CONTACT:

Lynn G. Bailey, Rebman Properties, Inc. A CORFAC International Member, 1014 W. Fairbanks Avenue, Winter Park, FL 32789 USA . Tel: 407.875.8001. Fax: 407.875.8004. Corporate facility advisors associated globally with KingSturge

lynn@rebmanproperties.com

Metro Orlando Industrial Market Flat but Tenant Prospects Increasing, Says Rebman Properties Report

ORLANDO, FL--Greg Rebman, (right top photo), vice president and corporate/industrial specialist of Winter Park, FL-based Rebman Properties Inc., reports Orlando’s bulk warehouse leasing market was quiet in the first quarter of the year for the third consecutive quarter, although there were two large subleases signed and a number of large tenants shopping the market.

Demand

There was 111,876 square feet of net absorption in the 132 surveyed buildings. In spite of the flatness of the market, the net absorption was at an average quarterly level because of the fact that the market was relatively inactive both in entrances and exits.

The good news is the increased number of prospective tenants with requirements in excess of 100,000 square feet who are currently shopping. The trick will be to convert this activity to signed leases in this “wait-and-see” market.

The largest leases for the first quarter were as follows:

U.S. Postal Service subleased 188,468 s.f. at 2000 Landstreet Road;
ROL Manufacturing subleased 88,000 s.f. at Sunbelt Distribution Center;
Prologix leased 75,900 s.f. at OCC #600;
Dal-Tile leased 62,377 s.f. at Cypress Park East III; and
Dayton Superior leased 44,600 s.f. at Liberty Park @ AIPO, Building B.

Supply

The vacancy rate rose from 11.71% at the end of 2007 to 12.75% at end of the first quarter. Two new buildings were added to the survey: Northwest Distribution Center, Building A, a 117,048 square foot, rear-load facility; and Northwest Distribution Center, Building B, a 200,232 square foot, cross-dock. Vacancy rates have risen steadily since the second quarter of 2004, when they were at a low of 5.37%.


Rental Rate

The average quoted rental rate for the 132 buildings surveyed is $4.66 psf triple net, virtually unchanged from the average of $4.65 psf triple net at year end, and $4.63 psf triple net at the end of the third quarter of 2007.

Construction

Beachline Corporate Center, Building 100 is under construction at 15000 Aerospace Drive in International Corporate Park. The 360,000 square foot, cross-dock facility is slated for completion in June.

Beltway Distribution has just broken ground on three buildings slated for completion in November. Building #100 is a 141,810 square foot, rear-load facility; Building #200 is a 145,540 square foot, rear-load; and Building #400 is a 378,600 square foot, cross-dock facility.

Forecast

Industrial brokers responding to the survey generally expressed that the market is flat, but were hopeful for the coming quarters because of the increase in large tenant prospects circulating the market. Brokers have varied explanations for the increase, from “a market anomaly” to the fact that in a contracting market many large tenants consider centralizing their supply chain, thereby consolidating their warehouse facilities.

Tenant prospects are continuing in their “wait-and-see” mode and many existing tenants are asking for short renewal terms, e.g. 12-month renewals.

Overall, it is expected that leasing in Orlando will remain flat through the end of the year before resuming the strong absorption seen in 2006 and the first half of 2007.

CONTACT:
Lynn G. Bailey

Rebman Properties, Inc.

A CORFAC International Member
1014 W. Fairbanks Avenue

Winter Park, FL 32789 USA

Tel: 407.875.8001

Fax: 407.875.8004

lynn@rebmanproperties.com