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Industrial Vacancy Drops, Sublease Space Slows Recovery

PHILADELPHIA-The third-quarter industrial vacancy for the entire Philadelphia MSA dropped to 11.7%, down from 12.4% in the previous quarter, according to Cushman & Wakefield data. Available sublease space, however, increased slightly, impeding robust growth.

By Marita Thomas | Updated on November 07, 2003

PHILADELPHIA-Industrial activity, including manufacturing and employment, ticked up a notch throughout the MSA during the third-quarter, according to research from the local office of Cushman & Wakefield. As a result, the industrial vacancy rate for the overall MSA fell to 11.7%, down from 12.4% in the previous quarter.

While the drop is a welcome sign, the vacancy rate had been as low as 5.6% in 2000. Sublease space in third-quarter 2003 accounted for 1.8 million sf of overall available space. While that’s just a slight increase from the previous quarter, “absorbing the discarded space continues to impede robust growth,” C&W researchers say.

Philadelphia County experienced the largest decline in vacancy, down from 11.9% in the second quarter to 10%, primarily because some of its less competitive inventory was taken off the market. Overall vacancy in the western suburbs fell from 13.2% in second quarter to 12.5%, largely because of Tyco Healthcare’s 636,000-sf lease for warehouse space along the 422 Corridor.

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