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Vacancy rate rose moderately to 6.2%. Midway through the third quarter, the vacancy rate grew 40 basis points to 6.2%, compared to this time last month at 5.8%. Occupancy of the almost 600,000 sq. ft. delivered to the market year-to-date stands at 59.3%, and of the 24 properties with 4.4 million sq. ft. currently under construction, 46.2% of that space is available for lease. Year-to-date net absorption totals -203,904 sq. ft., as A’Gaci’s bankruptcy reorganization plans move forward, vacating their 283,818 sq. ft. distribution facility in Von Ormy. In addition, there have been 202 deals accounting for 2.0 million sq. ft. of leasing activity. The average annual asking rate of renting industrial space is $6.16 per sq. ft. on a triple net basis.
Investment sales down year-to-date through July. According to Real Capital Analytics, investment sales of industrial properties in the San Antonio area totaled $137.8 million, a -62.3% change from one year ago. REIT/listed has been the most active buyer type for 2018, comprising 55.0% of San Antonio’s total sales volume, followed by private buyers at 22.0% and cross-buyers and user/other investors, both representing 11.0% each.
Economic growth remained mild in June. Job growth inched up in San Antonio at a 0.5% annualized rate in the second quarter. Goods-producing industries continued to grow, although mining and manufacturing slowed from very strong growth earlier in the year. Construction jobs accelerated, adding nearly 1,000 jobs, while leisure and hospitality continued to shed jobs. San Antonio’s seasonally adjusted unemployment rate stayed at 3.3% in June, well below the 4.0% rate for both Texas and the U.S.
Director of Research
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