Robust Leasing and Sales Activity
Strong leasing and sales velocity resulted in a low vacancy rate of 5.98% at mid-year 2014 for the Columbia, South Carolina industrial market, down from 7.26% at the end of the first quarter of 2014. The market absorbed just under 500,000 square feet of industrial space during the second quarter of 2014.
With only 1 Class A industrial building and 6 class B industrial buildings having large blocks of space over 100,000 square feet, a clear demand for speculative development exists in the market. Although speculative construction has been absent from the market since 2008, several projects are currently in the works. The first of such projects is a 38,500 square foot industrial building at 1510 Key Road which pre-leased to Trane USA just weeks after being announced. A 70,000 square foot speculative building is under construction in the Shop Grove Industrial Park with 35,000 square feet pre-leased to T&C Metals. Lexington County announced plans for a 120,000 square foot speculative building at Saxe Gotha Industrial Park, home to Amazon’s fulfillment center and the recently opened Nephron Pharmaceuticals. Construction on the $5.9 million building is slated to begin in the fall of 2014. A challenge for new speculative development is still difficulty funding the projects. In some markets, such as Newberry County, local government entities and developers are helping finance the projects.
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