As we approach the holidays retailers are quickly leasing warehouse space to fill online orders which is driving vacancy rates to the single digits in some cities. For example warehouse space vacancy in Austin is hovering around 6%.
Customers these days expect to receive products quickly and will typically order from whoever can deliver the quickest…..especially during the holidays. In an effort to speed up delivery times companies are renting warehouse space closer to major populations and will keep more products in stock.
More industrial space has been leased in 2016 than in 30 years as retailers have been leasing warehouse space faster than they can be built.
This increase in demand is also pushing up rents. In Austin average industrial base rents are $0.55 to $0.60 sf + NNN. In an effort to retain and attract new customers companies are willing to pay these rates. It’s all about having the right products near the customer at the right time………and this means having more than one point of distribution.
Finding warehouse space in Austin is very challenging right now. If you need help please give us a call at 512-861-0525