Newspaper article THE JOURNAL RECORD

Okla. City's Industrial Market Vacancy Rate Declines

Newspaper article THE JOURNAL RECORD

Okla. City's Industrial Market Vacancy Rate Declines

Article excerpt

After hitting some significant highs in overall vacancy at the end of 2003, the Oklahoma City industrial market has experienced some mild relief as the result of a handful of large transactions that transpired during the first half of the year.

Over the past few months, well over 750,000 square feet has been absorbed as the result of such transactions as Smith & Nephew's 100,000-square-foot lease in the former Seagate building at the northeast corner of W. Reno and N. Meridian avenues, and the lease by a wholesale grocer group of the 124,000-square-foot Fleming warehouse at Interstate 35 and SE 59th.

The most notable transaction that occurred was Jasco Products' $8.2 million purchase of the 412,200-square-foot Fleming distribution center at 10 E. Memorial Road. The electronics distributor has relocated its facilities to the building and is in the process of expanding its operations.

We have seen some significant sales and lease activity with larger buildings that has helped to reduce the vacancy rate, says Randy Lacey, associate vice president of the industrial services division of Grubb & Ellis/Beffort Brooks Hogan.

Lacey says that overall vacancy including both multi-tenant industrial buildings and owner-occupied facilities has fallen from 16.9 percent to 13.2 percent. However, firms like Trammell Crow that track only multi-tenant facilities are reporting a vacancy of around 32 percent.

Because so much of Oklahoma City's industrial vacancy is tied up in larger distribution centers of over 100,000 square feet, Lacey adds that it will take only a few more large transactions to drive the vacancy rate further down.

All you needed was a half dozen building sales and leases and all of sudden you are back at a fairly normal vacancy rate, he said. The market is starting to stabilize where we would have been had we not had this deluge of large buildings come on the market.

Mark Patton, vice president of Gerald L. Gamble Co., believes it may still take some time before these large spaces are absorbed because not many large industrial users are seeking space in the local market. …

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