Charleston’s Industrial Market Steady Sailing

Q3 2013 Recap

Charleston’s industrial market was stable through the third quarter. This period was characterized by existing tenants consolidating and repositioning into more functional space and the continuance of the national trend of users purchasing their facility. As was noted in the second quarter report, the mix of tenants is realizing a fundamental change as existing manufacturers are growing and new manufacturers are considering the Charleston area.

Port users appear stable yet the existing prospects for the region are calling for larger facilities than in the past. The market continues to be constrained by the lack of class A industrial buildings. Although Charleston can meet the need for facilities of 150,000 SF and smaller, the area is challenged to compete with Savannah on offering ready larger facilities. Yet, the deep draft argument remains compelling with shippers giving Charleston the ultimate advantage. Regional suppliers continue to target the Charleston area resulting in a steady flow of leasing activity in the 15,000 – 50,000 SF range.

Several specialized manufacturers are seeking new facilities due to aggressive growth projections. These include auto-related manufacturers as well as firearm manufacturers. Some of them will require upfitting the building with a large investment in heavy power, a large office build-out, HVAC and compressed air systems.

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