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Norfolk Industrial Q4 Report
Norfolk’s vacancy rate sat at a record low of 1.6% to end Q4 2020, with only 1.3%of warehouse space and 4.9% of flex space vacant. This is the lowest vacancy the market has seen in the past decade, as the vacancy rate has been tightening since it reached a decade-high of 8.9% in 2012. It decreased 54 basis points (bps) quarter-over-quarter and 139 bps year-over-year. The market saw 421,045 square feet of positive net absorption during the quarter and a total of almost 1.7 million square feet of positive net absorption throughout 2020. There were a few large occupations during the quarter that helped contribute to this positive absorption, such as Reach International occupying 122,916 square feet of space at Commonwealth Storage Facility in Suffolk and Aclara Smart Grid Solutions, Eimskip Logistics, and Grand Brands LLC occupying 5816 Ward Court, leading to over 180,000 square feet of positive absorption in the Airport Industrial Park submarket.
Average asking rents ended Q4 2020 at $5.58, an increase of $0.01 quarter-over-quarter and $0.70 year-over-year. Rents are the highest they have been over the last decade, with market rents averaging $4.92 over that period. Much of this can be attributed to a tight, owner-favorable market that lacks available quality space for buyers and tenants.
Average asking rents ended Q4 2020 at $5.58, an increase of $0.01 quarter-over-quarter and $0.70 year-over-year. Rents are the highest they have been over the last decade, with market rents averaging $4.92 over that period. Much of this can be attributed to a tight, owner-favorable market that lacks available quality space for buyers and tenants.
