Q1 industrial market report from Cushman & Wakefield | Thalhimer
From Cushman & Wakefield | Thalhimer
Unemployment for the Fredericksburg region remains below 4.0%, currently hovering at 3.8% with a strong addition of 4,574 jobs added from January of 2017 to January 2018. The U.S. economy is showing marked improvement with hiring, rising wages and rising interest rates.
Demand for industrial property remains very strong throughout the Fredericksburg region. The area recorded over 100,000 square feet (sf) in leasing activity for the first quarter. No new industrial projects are currently under construction, which is limiting available product.
Vacancy is down and remains below 6.0% with office/flex dipping into 4.0% and warehouse going up to 6.1%. Absorption increased significantly. Asking rents are starting to gradually rise as demand increases and available space declines.
Transactions of note include former Harkness Screens location at 10 Harkness Boulevard; the 59,400-sf building sold to an investor for $3.08 million. Imaan International, Inc., a computer distributor, leased an additional 19,540 sf at 2000 International Parkway. Walmart Stores leased 44,650 sf at 3000 Mine Road. First Line Constructions renewed its lease at 11,500 sf at 11765 Capital Lane.
Absorption was very strong in the first quarter of 2018 and is expected to continue on this path throughout the second quarter. Tax law changed in Stafford County to lower the inventory tax being charged on buildings of 100,000 sf or larger, which should increase demand for industrial space.