San Antonio Industrial market records highest net absorption ever recorded in first month of year, continuing momentum from 2021.
VACANCY RATE AT 4.6%
One month into 2022, overall vacancy in the San Antonio industrial market has tightened to 4.6%, dropping 160 basis points from this time last year. Availability is at 7.7%, down 80 basis points from January 2021. The difference between this figure and the vacancy rate reflects expected future move-outs. The San Antonio industrial market has recorded 639,000 million sq. ft. of leasing activity—which is comprised of both new leases and renewals—while net absorption (move-ins minus move-outs) is at 814,000 sq. ft., up 100% year-over-year from 2021 at 409,000 sq. ft. January 2022 marks the highest amount of net absorption in the month of January on record. The San Antonio metro NNN average asking monthly rent is at $0.56 per sq. ft., up from $0.53 this time last year.
DEMAND OUTPACING SUPPLY
Among the notable move-ins that contributed to the above average net absorption in January include Tubework moving into 180,000 sq. ft. in Cornerstone Industrial Park in the Northeast submarket; 179,655 sq. ft. and 175,055 sq. ft. both occupied in Gateway 10 Business Park in the Northeast submarket; 114,100 sq. ft. filled up at 4210 N Interstate Highway 35 in the Northeast submarket; and Post Center International moving into 102,485 sq. ft. at 4958 Stout Drive in the South submarket. This is the first January on record with no space delivered to the market.
CONSTRUCTION AT AN ALL-TIME HIGH
The San Antonio industrial market has 10.8 million sq. ft. under construction, a significant amount of space underway as a percentage of inventory at 8%. About half of what’s underway is associated with Amazon’s expansion. Outside of the two Amazon projects, a build-to-suit for Navistar (900,000 sq. ft.) represents another significant portion of the pipeline. Aisin, a Toyota supplier, recently completed its own $400-million build-to-suit facility last year, although at half the square footage of Navistar’s project. Aisin’s 500,000-sq.-ft. manufacturing facility in Cibolo will house approximately 900 workers. Navistar has said it will hire about 600 workers.
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