Report: Flex, R&D & Warehouse Space In Demand Across 495
Despite weariness in the midst of national and international economic conditions, niche rental space across Central Massachusetts continues to fare reasonably well. Tenants are looking to take advantage of low rates on high-quality space, according to new real estate data on industrial, flex and manufacturing rental space across MetroWest.
Demand for industrial properties across Central Massachusetts grew for a second consecutive quarter, Boston-based real estate tracking firm Richards Barry Joyce & Partners (RBJ) found in its most recent market report.
In fact, during the past two quarters the overall Greater Boston region saw the greatest absorption - or property rentals - since the final months of 2006 and the first quarter of 2007.
The 1.2 million square feet of new rentals in industrial, manufacturing and R&D was dominated by almost 900,000 square feet of absorption in the warehousing sector, where vacancy rates dropped from 18.5 percent to 16.9 percent from the second to third quarters of the year, RBJ found.
Tenant Trends
In MetroWest, R&D space continues to be in high demand, according to a report by Cassidy Turley FHO, formerly FHO Partners, another Boston-based commercial real estate tracking firm.
Vacancy rates for R&D space in Natick and Framingham combined to be 2.5 percent, according to FHO, with asking rents at $13.21 per square foot. That compares to an office space vacancy rate of 14.1 percent, with asking rents of $19.97 per square foot in the towns that make up the heart of the MetroWest commercial real estate market. There is also more than four times as much office space compared to R&D space in the two-town region, however.
Across the greater Interstate-495 area, the vacancy rate for R&D space sat at 9.3 percent; it was 20.6 percent for the office market.
Flex space, rentals that can be suited to a customer's needs or used for office or warehouse space, continues to be in fairly high demand, especially in the southern part of the I-495 region, RBJ found.
Vacancy rates for flex space were 9.8 percent in the 495 South region, while they averaged 15.5 percent across the entire 495 corridor.
Manufacturing space was in greater demand in the 495-West market, with a vacancy rate of 14.2 percent, compared to a regional rate of 21.2 percent.
Warehouse space, meanwhile, is in high demand in the 495-South region as well, with a vacancy rate there of 14.1 percent, compared to an overall 495-wide vacancy rate of 17.4 percent.
RBJ expects asking rents to stabilize next year and noted that modern, well-maintained space continues to be in the highest demand across Central Massachusetts.
For complete coverage of the MetroWest commercial real estate market, check out our Real Angle column in each issue of MetroWest495 Biz.
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