Oahu’s industrial market finally rallied after posting four consecutive quarters of negative net absorption between 1Q2017 and 1Q2018. Generating its first quarterly occupancy gains for the year, the industrial market posted 69,911 square feet of positive absorption in 2Q2018. Vacancy rates, which had risen to 1.99% during the first quarter of 2018, declined to 1.82% at the end of June 2018.
While there may have been concerns among landlords that industrial market demand had slowed, Colliers predicted earlier that the increase in vacancy rates would be temporary. With vacancy rates remaining under 2% for more than three years, prospective tenants who were unsuccessful in finding potential expansion and relocation space likely postponed their searches based on lack of suitable inventory. Going forward, as long as pricing is consistent with current market levels, any new warehouse spaces being developed should be met with heightened interest from prospective businesses.