More than 2.7 million square feet of industrial/warehouse space was leased in the greater Baltimore metropolitan region, nearly replicating the nearly 2.6 million square feet of space leased in first quarter 2022, according to a report recently released by Lee & Associates | Maryland.
These figures add to the approximately 15 million square feet of industrial/warehouse space leased in the region during last year, according to the fully-integrated commercial real estate brokerage and management firm that is headquartered in Columbia.
Net absorption rose to 1.7 million square feet of space, after registering approximately 930,000 square feet of space in the first quarter and the overall vacancy rate rose to 3.95 percent, from 3.7 percent for the first quarter. Nearly 15 million square feet of space is now under construction, a volume that is substantially above the 12.2 million square feet of space reported last quarter.
“While there has been a partial slowdown in demand for larger industrial spaces, the need for infill locations has increased and has been partially responsible for the vacancy constriction,” said Tom Whelan, principal, Lee & Associates | Maryland. “The greater Baltimore industrial market continues to follow the growth pattern of the industrial sector nationally, and expect leasing to remain consistent for the balance of the year. Possibly as a direct result of inflation, rental rates also continue to rise.”
Approximately 1.6 million square feet of space was delivered in the second quarter, bringing the total volume of space delivered in 2022 to approximately 3.6 million square feet of space. Average asking rents rose to $7.66 from $7.28 per square foot. Sixty-six sales transactions were completed at a cumulative value of nearly $517 million. Approximately 10.3 million square feet of industrial/warehouse space is available for lease locally, down from 10.9 million last quarter.
The area’s largest leases were the 598,000-square-foot lease signed by Baltimore International Warehouse & Transportation, 2800 Eastern Boulevard, Middle River; the 186,000-square-foot lease signed by Infarm at 8700 Robert Fulton Drive, Columbia,; and Alcon’s 142,000-square-foot lease at 6740 Business Parkway, Elkridge.