Charlotte Industrial Vacancy Rate Reaches Five-Year High

ATLANTA-The Charlotte industrial vacancy rate reaches 8.8% in second-quarter 2002, its highest in five years according to a market report from the Charlotte office of Los Angeles-based CB Richard Ellis Inc. pA year ago, it was 6.8%. It was 8.2% at the end of first-quarter 2002.

The report attributes the rise to the completion of five new buildings that added a total of 315,666 sf to the market along with “a significant amount of warehouse space being vacated.”

Among those vacated are the 79,600-sf APS Auto Parts warehouse on Gulf Drive and a 76,062-sf freestanding building on Nations Ford Road. In addition, “the 128,000-sf Shopton Ridge 1 building was delivered fully vacant,” the report says.

The study also notes, however, that an Ingersoll Rand lease of 346,500 sf at 9801 Twin Lakes Parkway, which will not be posted until third quarter, and other pending activity represents “some signs of improvement, (though) overall activity continues to be much slower than normal.”

The North and West submarkets have the highest vacancy rates, 15.5% and 15.4%, respectively, according to the research. The Northwest submarket experienced increased vacancy to 8% in second quarter, compared with 7.8% in first quarter.

Quoted rents vary significantly. Newer, class-A warehouse properties fetch from between $3.35 per sf to $3.80 per sf, while second-generation space rates are between $2.75 per sf and $3.25 per sf.