Published May 8, 2013
As the demand for industrial space climbs, Midlands counties and utilities have been leading the way in speculative development, according to the latest market report released by NAI Avant.
Overall, vacancy of 497 buildings included in the survey hovered slightly above 11%, said Nick Stomski, who authored the report for the commercial real estate firm. Columbia’s strategic location in the Southeast market continues to attract national and international companies “seeking a business-friendly climate in a centralized location,” he added.
Nick Stomski of NAI Avant
Another local government investing in spec development is Newberry County, Stomski said. The county, with assistance from local utilities, plans to break ground on a 50,000-square-foot building at Mid Carolina Commerce Park, located off Interstate 26.
In the private sector, speculative development “has been relatively nonexistent with only one 40,000-square-foot project in the preliminary stages,” Stomski said.
The building will be built in southeast Columbia off I-77, and is scheduled to be completed in the fourth quarter of this year. The structure will be front-loaded with 28-foot clear height ceilings. The expected quoted rental rate is $4.25 per square foot, the report added.
The report noted that the area soon will see the completion of major industrial projects such as the new Continental Tire plant in Sumter, and expansion projects at Michelin in Lexington and Bridgestone in Aiken County.
“Lexington County is on a roll,” Stomski said, noting that Nephron Pharmaceuticals has a $313 million facility underway in the Saxe Gotha Industrial Park near Cayce. Also, Avtec’s 46,000-square-foot headquarters and manufacturing facility is nearing completion at Horizon Technology Park.
In addition, a technology park is planned for the town of Chapin. Local officials hope to attract companies specializing in computer data and financial services, as well as companies involved in the construction of two reactor units at V.C. Summer Nuclear Station near Jenkinsville, about 10 miles north of Chapin.
The overall vacancy rate of warehouse and manufacturing facilities was 11.4% at the end of the first quarter, the report said. The vacancy rate for 5.8 million square feet of Class “A” space was 13.4%; 6.9% for 22.3 million square feet of Class “B” space; and 16% for 19 million square feet of Class “C” space.
The overall asking rental rate in the Midlands was $3.51 per square foot.
“Although we saw slight negative absorption in the first quarter of 2103, activity has been increasing and the appeal of the central Midlands will continue to attract investment,” Stomski said.
He expects space will tighten and rental rates will rise “giving way to increased development and employment strides for the region.”