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27
Over the past 15 years, a significant amount
of the City’s industrial land has been
converted to residential uses. In 2013, there
were 293 acres of vacant industrial land
available.
Today Morgan Hill has only
approximately 247 acres of industrial land
available for development and virtually no
product available for lease with historically
low vacancy rates in office and R&D.
Since 2013, rents for industrial, office, and
R&D space have increased significantly and
the vacancy rate for office and R&D has
declined dramatically. The City added
121,000 square feet of new inventory over
the last five years.
3
Morgan Hill has
experienced a robust amount of investment
from companies choosing to expand and
buy real estate in the Morgan Hill market.
However, other parts of Silicon Valley are
experiencing new commercial development
at a far faster rate.
Figure 14. Industrial, Office, and R&D Market Statistics, 4
th
Quarter 2016
Industrial, Office, and R&D Market Statistics: Morgan Hill, 4th Quarter 2016
Industrial
Office
R&D
Building Inventory (Sq. Ft.)
2,365,493
749,932
2,874,930
Vacancy Rate
7.7%
5.2%
3.6%
Average Asking Rent Per Sq. Ft.*
$0.84
$2.07
$1.01
*Average asking rents for Industrial and R&D are triple net, while office is presented in full-service.
Source: Colliers International, 2016.
3
Based on an analysis of CoStar data.