Industrial Real Estate Market Expected to Be Challenge
Fears, Ronda, THE JOURNAL RECORD
That is the prediction of Coldwell Banker Commercial Group Inc., which presented its annual forecast for the metropolitan real estate market Monday.
"Obtaining financing continues to be difficult even for well-established companies with more than adequate collateral," said Randy L. Lacey of Coldwell Banker. "This should continue in 1990 with no end in sight.
"The Oklahoma City industrial real estate market in 1990 will continue to be challenging, but opportunistic for well-financed users, investors and developers."
The vacancy rate is forecast to decline as absorption rises. Rental rates are expected to remain constant for distribution warehouses and increase for service centers.
New developments are projected to be limited to build-to-suit projects as land activity centers around demand for three- to five-acre tracts and land prices continue to drop.
Vacancy is forecast to improve from the yearend 12.77 percent to 11 percent. The vacancy rate deteriorated in 1989 from 11.08 percent, with vacancy downtown and north decreasing while vacancy southeast and southwest increased. The overall rise in vacancy was attributed to a rise in new construction, which affected warehouse rental rates, the report said.
"As the year progressed, we had unexpected additional (distribution space) added, which seemed to short-circuit the improvement process," Lacey said.
Distribution warehouse rental rates are projected to remain constant, varying between $1.70 per square foot for pre-1980 buildings and $2.75 for the newest facilities.
Service center rental rates, however, should increase as the available supply continues to diminish, the report said. …