INDUSTRIAL LAND IN A POST-INDUSTRIAL CITY District of ...
INDUSTRIAL LAND IN A POST-INDUSTRIAL CITY District of ...
INDUSTRIAL LAND IN A POST-INDUSTRIAL CITY District of ...
Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
<strong>District</strong> <strong>of</strong> Columbia Industrial Areas Study DC Office <strong>of</strong> Planning<br />
Prepared by Phillips Preiss Shapiro Associates, Inc.<br />
At $12.31 per square foot, the Warehouse rental rates are a more accurate reflection <strong>of</strong> market<br />
activity in the industrial sector. This average rate is 50 percent higher than the regional average<br />
<strong>of</strong> $8.08 per square foot, but it is somewhat lower than the average for Fairfax County, which<br />
commands the highest warehouse rents in the region. 23<br />
Recent Absorption Trends<br />
During the past five years, vacancy rates for each category <strong>of</strong> industrial space have gradually<br />
decreased after the region’s Flex vacancy peaked in 2003 at 16.8 percent and the Warehouse<br />
market highest rate <strong>of</strong> 8.0 percent in 2003.<br />
The <strong>District</strong>’s industrial absorption rates have been more tenuous. Although positive absorption<br />
rates have been recorded for the first three quarters <strong>of</strong> 2005, this uptrend follows a year <strong>of</strong> four<br />
consecutive quarters <strong>of</strong> negative absorption.<br />
In the third quarter <strong>of</strong> 2005, net absorption <strong>of</strong> industrial space (Flex and Warehouse space<br />
inclusive) totaled 123,190 square feet.<br />
New Construction<br />
Since the beginning <strong>of</strong> 2002, only 25,000 square feet <strong>of</strong> new industrial space has been<br />
constructed in the <strong>District</strong> <strong>of</strong> Columbia.<br />
3.2.3 FACTORS IMPACT<strong>IN</strong>G THE DISTRICT OF COLUMBIA’S CURRENT <strong><strong>IN</strong>DUSTRIAL</strong><br />
MARKET<br />
In November 2005, six active industrial real estate brokers were interviewed regarding<br />
conditions in the <strong>District</strong> <strong>of</strong> Columbia’s industrial market. Based on their input and independent<br />
research, the following five issues were identified as critical to the future strength <strong>of</strong> the <strong>District</strong>’s<br />
position in the region’s competitive industrial landscape.<br />
Location and Accessibility<br />
Proximity to railroads and major roadways has guided industrial real estate value for over 100<br />
years. Based on these criteria, the low vacancy rates and high appeal <strong>of</strong> the V Street Industrial<br />
Corridor is unsurprising. However, despite its location between freight lines and Routes 50 and<br />
Alternate 1, asking rents along V Street range between $5.00 and $7.00 per square foot, which<br />
23 Ibid.<br />
- 69 -