It’s no secret that the industrial market has been one of the darling asset classes throughout the pandemic in Massachusetts. However, while finding space and acquisition opportunities was difficult in 2021, numbers of the first quarter of this year indicate more difficulties for tenants and owners for the remainder of 2022.
For the first time ever, for example, 495 South industrial market has hit 2.5% vacancy. This has caused a decrease in deals completed in Q1, not because of a slow-down in demand, but because there is physically nowhere for companies to go.
Surprisingly, users have resorted to looking outside of Massachusetts to neighboring Connecticut, Rhode Island, and New Hampshire markets. In many cases, these subsidiary markets are seeing similar supply constraints, and pricing is now almost equivalent to Massachusetts.
At R. W. Holmes, we know that many sites are under permit or about to begin construction, but there is little supply available for immediate occupancy within the next 6-12 months across all user sizes. Notably, users under 25,000 SF are being significantly impacted by the lack of supply, with very few of the industrial projects under construction tailoring to these smaller users.
The only game in town for industrial space now is to look out and plan. If you need immediate help, please call us.