Growing inventory, decreasing vacancy and stiffening rental rates summarize the bustling Greater Charleston industrial market. Activity stems from traffic through the Port of Charleston, development of the area as a larger distribution market and progression in the establishment of the aviation industry. Surveyed inventory grew from year-end 2005 by approximately 2.5 million square feet, mostly from bulk warehouse properties. Third party logistics providers continue to expand to handle merchandise, and larger bulk warehouses are being developed to satisfy growing demand from this sector of users. Carolinks is in the process of setting up a privately owned rail served shipping terminal intended to rail containers to inland distribution center parks. The impending completion of the Global Aeronautica facility for the construction of the Boeing 787 fuselage section is creating interest from aviation industry suppliers nationally and internationally. With an overall market vacancy rate of 6.33%, moves are being made by regional and national industrial developers to tie up large land tracts in order to master plan new industrial parks. Contemplated development includes several million square feet of new product. With a tighter market and increased costs of land and construction, overall rental rates have continued to climb. Additionally, increases in taxes, insurance and maintenance have made occupancy costs that much higher.
Bulk warehouse product continues to grow and be the largest component of the industrial market. With more than sixty properties containing at least 100,000 square feet, this market segment has been transformed into a realistic and competitive distribution location. Although much of the bulk development over the past few years was in Charleston Regional Business Center and along North Rhett Boulevard, where Johnson Development is constructing a 315,000 square foot building, more of the recent and proposed development is occurring further out I-26 in upper Charleston, Dorchester and Berkeley Counties. Notable developments are Fruit of the Loom, East Coast Molding and the planned American LaFrance facility.
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