Big Box Deliveries Total 20 Million Square Feet in 2017
New big box development activity set a record in 2017 with 37 buildings 200,000 square feet or larger totaling nearly 20 million square feet delivered. This is the greatest amount of big box buildings to be completed during a calendar year in the market’s history, and a 13.76 percent increase over the 17.5 million square feet completed in 2016. Four of the projects delivered are 1.0 million square feet or larger.
Despite record construction activity, demand fell slightly during 2017, dipping below both 2016 and 2015 levels. Net absorption, an indicator of demand that measures the net change in occupied space from one period to the next, totaled an impressive 12.6 million square feet in 2017 among big box buildings. This was 21.76 percent below the 16.1 million square feet net absorption total recorded in 2016. This slight dip in demand was due to fewer new leases being signed in big box facilities.
22 speculative big box buildings totaling 10.7 million square were delivered during 2017. These buildings were 84.95 percent vacant at the end of the year and added 9.1 million square feet of vacant space to the market. This pushed the big box vacancy rate up 244 basis points during the course of 2017 to 9.64 percent.
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