Who Says the Economy is not Recovering?
Cord Moving and Storage is reporting that the U.S. industrial real estate market continued to improve during the second quarter of this year even as the economic recovery lost momentum. The industrial market posted strong leasing activity, declining vacancies and diminished supply, which most national analysts said should set the stage for an acceleration in net absorption and rising rents in upcoming quarters.
The U.S industrial vacancy rate fell to a two-year low of 9.8%, down significantly from 10.4% a year ago, while most other indicators improved marked in the second quarter, according to The National Mid-Year 2011 Industrial Outlook and Review.
Although quarterly absorption numbers were modest, the warehouse market has now experienced five consecutive quarters of positive demand totaling 103 million square feet — exceeding the 59 million square feet of net absorption in early 2002 to late 2003 following the previous downturn, which admittedly was much less severe.
However, absorption of warehouse space remains roughly half what analysts would expect given the overall rebound economic growth since early 2010. “Overall, this is a good, but not great, recovery,” said Charlie Wormek, Director of the Commercial Relocation Division for Cord Moving and Storage headquartered in Saint Louis, MO.