M A R K E T B E AT
RICHMOND, VA
Industrial Q4 2019
YoY 12-Mo. ECONOMY: Steady Employment Growth throughout 2019
Chg Forecast
Richmond’s economy added 8,000 jobs over the past twelve months, lowering the unemployment rate 20 basis points (bps) to
2.9% 2.8% during that time. Office related employment, education and health services, and leisure and hospitality sectors contributed the
largest employment gains. The Richmond Marine Terminal continues to witness rising amounts of cargo. The dredging project to
Vacancy Rate make Virginia the East Coast’s deepest port launched 2.5 years earlier than expected in Q4 and positions the state to be the east
Coast’s premier trade gateway. Wegman’s plans to locate a $175 million distribution facility in Hanover County. In Chesterfield
519k County, Carvana plans to create vehicle inspection facility and Cartograf announced it will build its first U.S. facility in the county.
Net Absorption,SF The companies cited Richmond’s strategic location, robust workforce and cost to do business as key influences to invest in the
Richmond region.
$4.89 SUPPLY and DEMAND: New Deliveries are being Quickly Absorbed
Asking Rent, PSF
Quality warehouse space continues to be difficult to find. New deliveries are being leased prior to completion. Speculative
Overall, Net Asking Rent development is expected to increase following recent success of Panattoni’s Virginia I-95 Logistics Center. Three development
projects are scheduled to deliver before the summer, totaling over 800,000 square feet (sf) of distribution and warehouse space.
Brookwood Capital Partners will deliver 152,000 sf in its Northlake Commerce Center project and Becknell Industrial continues work
ECONOMIC INDICATORS on a 246,700 sf warehouse building in its Airport Distribution Center, both projects are pre-leased, while Devon USA is progressing
Q4 2019 with a 320,000 sf warehouse building,. Scannell Properties has purchased two developments sites that could hold 645,000 sf of
warehouse space, while Hourigan Development’s DeepWater Industrial Park could add 1.5 million square feet of distribution space
YoY 12-Mo. when it is fully completed.
Chg Forecast
687k PRICING: Slow and Steady Asking Rent Growth
Richmond MSA Rental rates steadily increased during 2019, ending the year up 3.8% when compared to Q4 2018. New deliveries may be able to
Employment
command higher rents, but new construction has been comprised of larger scale buildings and mitigate the overall rental rates due
to their size. The majority of availabilities remain in lower quality buildings and large availabilities continue to be difficult to find
2.8% throughout the Richmond region. Rental rates are expected to continue to rise in 2020, with steady demand for distribution and
Richmond MSA warehouse space. The growth and investment in the inland port combined with Richmond’s access to major highways will
Unemployment Rate continue to attract tenants to the region.
3.6% SPACE DEMAND / DELIVERIES OVERALL VACANCY & ASKING RENT
U.S. $6 10%
3
Unemployment Rate
Millions
8%
$5
Source: BLS 2 6%
4%
$4
1
2%
$3 0%
0 2015 2016 2017 2018 2019
2016 2017 2018 2019
Net Absorption, SF Construction Completions, SF Asking Rent, $ PSF Vacancy Rate
full service asking
M A R K E T B E AT
RICHMOND, VA
Industrial Q4 2019
OVERALL OVERALL YTD NET UNDER OVERALL OVERALL OVERALL
TOTAL INVENTORY YTD LEASING
AVAILABLE VACANT VACANCY OVERALL CONSTR WEIGHTED AVG WEIGHTED AVG WEIGHTED AVG
SUBMARKET BLDGS (SF) ACTIVITY**
SPACE (SF) RATE ABSORPTION** (SF) NET RENT (MF) NET RENT (OS) NET RENT(W/D)
Downtown 5 185,266 0 0 0.0% 0 0 N/A N/A N/A
Northeast 167 10,896,001 645,029 183,894 1.7% (88,313) 0 N/A $9.00 $6.26
Northwest 311 19,658,250 790,215 409,466 2.1% 219,201 238,000 $5.35 $10.56 $6.19
Southeast 151 19,996,299 271,679 1,176,163 5.9% (654,354) 2,716,760 $4.91 N/A $5.11
Southwest 430 42,622,526 1,887,752 923,171 2.2% 2,012,826 350,853 $3.11 $7.50 $4.51
RICHMOND, VA TOTALS 1,064 93,358,342 3,594,675 2,692,694 2.9% 1,489,360 3,305,613 $4.23 $10.34 $5.03
*Rental rates reflect weighted net asking $psf/year. Leasing statistics include renewals. ** Stats on the table are not reflective of U.S. MarketBeat tables
OVERALL OVERALL YTD NET OVERALL OVERALL OVERALL
TOTAL INVENTORY YTD LEASING UNDER
AVAILABLE VACANT VACANCY OVERALL WEIGHTED AVG WEIGHTED AVG WEIGHTED AVG
PROPERTY TYPE BLDGS (SF) ACTIVITY CONSTR (SF)
SPACE (SF) RATE ABSORPTION NET RENT (MF) NET RENT (OS) NET RENT(W/D)
Warehouse/Distribution 761 61,790,866 3,147,152 1,771,476 2.9% 1,604,602 805,613 N/A N/A $5.03
Manufacturing 234 24,504,838 382,593 749,427 3.1% -110,058 30,000 $4.23 N/A N/A
Office Service/Flex 62 5,024,256 64,930 78,847 1.6% -4,325 0 N/A $10.34 N/A
MF = Manufacturing OS = Office Service/Flex W/D = Warehouse/Distribution
KEY CONSTRUCTION COMPLETIONS YTD 2019
PROPERTY SUBMARKET MAJOR TENANT SF OWNER / DEVELOPER
I-95 Logistics Center Jeff Davis Corridor Brother Printer 461,700 Panattoni Construction
I-95 Logistics Center Jeff Davis Corridor Amazon 461,700 Panattoni Construction
Bissell Jeff Davis Corridor Bissell 437,000 Bissell Homecare, Inc.
Northlake Commerce Center I-95 North / Ashland Fidelitone, UPS 152,000 Brookwood Capital Partners
JONATHAN KOES
KEY LEASE TRANSACTIONS Q4 2019 Research Manager
PROPERTY SUBMARKET TENANT SF Type
+1 804 697 3560 / [email protected]
8025 Quality Dr Prince George Campofrio Food Group 143,790 New A CUSHMAN & WAKEFIELD RESEARCH PUBLICATION
2300 Westmoreland Scott’s Add / West End Locke Supply Co 60,000 New Cushman & Wakefield (NYSE: CWK) is a leading global real estate
1936-1962 Ruffin Mill Rd I-95 S / I-295 S / Rt 10 S-L Distribution 58,048 New services firm that delivers exceptional value for real estate occupiers
and owners. Cushman & Wakefield is among the largest real estate
services firms with approximately 51,000 employees in 400 offices
and 70 countries. In 2018, the firm had revenue of $8.2 billion across
core services of property, facilities and project management, leasing,
KEY SALES TRANSACTIONS Q4 2019 capital markets, valuation and other services.
PROPERTY SUBMARKET SELLER / BUYER SF PRICE / $ PSF
©2020 Cushman & Wakefield. All rights reserved. The information
2800-2852 E Parham Rd Staples Mill / Parham Parham Forest Associates / Remuda Forest 68,097 $6.5 M / $95 contained within this report is gathered from multiple sources believed
to be reliable. The information may contain errors or omissions and is
4700 Bethlehem Scott’s Add / West End BluelLinx Corporation / Brennan Investment 154,442 $6.3 M / $41
presented without any warranty or representations as to its accuracy.
1703 Ruffin Mill Rd I-95 S / I-295 S / Rt 10 NCI Group / Big Green Tractor LLC 107,121 $5.0 M / $47
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