The report indicates that the Route 495 submarket experienced the highest vacancy and availability rates of nearly 19% and nearly 20%, respectively. The strongest submarket remains the 128/West market, which has an availability rate of nearly 8% and a vacancy rate of nearly 6%.

The big story for the market is its positive absorption of 88,000 sf in the second quarter after experiencing a negative absorption of 1.2 million sf in the first quarter of the year. The report notes that tenants continue to seek out newer, more modern facilities with high bay warehouse space. Many older facilities are vacant and it is their rents, which continue to drop, which have pulled down the average rental rate to $6 per sf.

The report further points out that while speculative construction has been largely stagnant in the market, companies with large requirements and specific criteria continue to seek out build-to-suit options. These companies are largely ignoring the older lesser quality buildings and are either leasing more modern facilities, or in some cases building new facilities. But as interest rates continue to increase, user sales may become less of a possibility. The report emphasizes that while the market is finally experiencing some positive absorption, it is still a long way from a complete turnaround.