Q1-2018-IndustrialReport
Q1
INDUSTRIAL STATISTICS MANUFACTURING
2018
MANUFACTURING
TOTAL INVENTORY (SF)
TOTAL VACANT (SF)
TOTAL VACANCY RATE
Q1 NET ABSORPTION (SF)
YTD NET ABSORPTION (SF)
Vacancy and Net Absorption
TOTAL
34,953,695
2,456,778
7.0%
(60,529)
(60,529)
600
10%
400
2014 2014 2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017
8%
200
VACANCY & NET ABSORPTION Vacancy and Net Absorption 0
TRENDS • Vacancies in Greater Boston’s Manufacturing market inched up by ten basis points during the first quarter of 2018. Move-outs from Zoots Cleaners in Brockton, General Mills in Methuen, and United HVAC in Hingham contributed to this quarter’s negative absorption, while an owner-user sale at 29 Everett Street in Holliston took 53,510 square feet off the market. With that said, rates are still 100 basis points below year-ago levels, and market conditions remain favorable for all industrial product types. Moreover, average asking rents continue to climb; surpassing $8.50/ SF in the first quarter. • Manufacturing sites are finding new life as self-storage facilities in Greater Boston. In the fourth quarter, a Utah-based self-storage company purchased 120 N. Main Street in Brockton with plans to convert the manufacturing facility into a 75,000-square-foot self-storage facility. Following the sale the previous owner-user, MicroWire Products Inc., shifted its manufacturing operations and relocated into 18,000 square feet at 5 Mear Road in Holbrook. In Framingham, Eastland Partners acquired a vacant manufacturing facility at 120 Leland Street with plans to also construct a new self- storage facility. Self-storage assets have performed exceptionally well this cycle as the heated housing market, downsizing Baby Boomers, and urban population growth have propped up demand. If this sector continues to perform well, the region could see more investment in self-storage facilities. • Some large blocks of manufacturing space could hit the market in the coming quarters. Ireland-based,Ardagh Group, announced plans to close its Milford beer bottling plant and lay off more than 200 workers. New England Confectionary Company (maker of NECCO wafers) is facing bankruptcy, which could result in the closure of the firm’s 829,000-square-foot Revere facility. The candy maker already downsized its operations by nearly 150,000 square feet in the third quarter of last year. • The region’s bustling life science industry continues to drive manufacturing activity in Greater Boston. Sanofi Genzyme is expanding its Framingham footprint, with plans to build a new 72,000-square-foot bio-manufacturing facility. King Street Properties recently purchased the former headquarters of the MetroWest Daily News on New York Avenue in Framingham. The life science developer/owner plans to renovate the property into a 107,350-square-foot multi-tenant life science facility. Finally, Waters Corp., a scientific equipment maker, plans to add 135,000 square feet to its Taunton facility, which will be operational by 2022. • There is currently several hundred thousand square feet of manufacturing space under construction, with 100% of it preleased. Most notably, Pfizer is constructing a 175,000-square-foot facility at its campus on Burtt Road in Andover and Insulet is redeveloping 100 Nagog Park into a 325,000 square foot facility. 2014 2014 2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017 2017 2017 2018 2017 2017 2018
6%
-200
600
10%
4%
SF (000s)
-4 0
400
8%
2%
-6 0
200
6%
0 -8 0
0%
2013
2014
2015
2016
2017
2018
-200
Net Absorption
Vacancy
4%
SF (000s)
-400
2%
-600
-800
0%
2013
2014
2015
2016
2017
2018
Net Absorption
Vacancy
ASKING RENT Asking ent
$10
$8
Asking Rent $6
$10
$4
$8
Asking Rent ($/SF) $6 $0 $2
tion 529)
2014
2015
2016
2017
$8.54
$4
NOTABLE TRANSACTIONS Notable Transactions
$2
Ho Toy Noodle
$0
Mystic Brewery 2014
2015
2016
2017
Mass Electric Construction
A & M Welding Fabrications
Millenium Printing
10K SF
35K SF
60K SF
85K SF
110K SF
Route 128 South Urban Core Route 128 West
6
aners in Brockton, General
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