Manatee's Saving Lease
by Laurel S. McQueen

As the economy continues to stall, marginal tenants are dropping out of the marketplace. As a result, business park leasing continued to be soft through second quarter 2001. Hillsborough County experienced a second consecutive quarter of net occupancy losses, while the rest of the region saw moderate improvements. The exception was Manatee County, which single-handedly saved the region from the net loss column.

Hillsborough's second quarterly loss pushed the county's annual absorption into the net occupancy loss column for the first time since third quarter 1991. Net losses were reported at 27 locations across the county. In addition, the survey charts reflect more than 340,000 sf of space that is either leased but available for sublease or coming available in the next few months. This hidden market raises the county's vacancy rate to 14.3 percent.

Construction was completed during the quarter on Fairfield Distribution VI and VII adding a total of 247,140 sf of space to the east Hillsborough submarket, 71 percent of which is available for lease. The submarket's vacancy rate climbed 3.4 percentage points. Construction was started during the quarter on Interchange Center, a new business park at I-75 and U.S. Highway 301. Phase I of this project totals 130,522 sf.

The picture in Pinellas County was rather stagnant with the annual rate ticking down just 4 percent and the vacancy rate down just 0.1 point. Construction was started during the quarter on a build-to-suit for Suncoast Roofers Supply Inc. at Capstone Commerce Center and on 130,000 sf of speculative space at Fortune 2000.

In the Pinellas Gateway, annual absorption dropped 20 percent as this quarter's net absorption replaced a much larger total from second quarter 2000 in the moving rate. Construction continues on 150,000 sf at the new 34th Street Industrial Park at 34th Street and Scherer Drive.

Manatee County's vacancy rate tumbled 4.9 points with the leasing of 302,700 sf to an undisclosed tenant at Palmetto Corporate Center. The remaining 80,000 sf of vacant space at this location still represents 30 percent of the county's total vacancy. For the last several years this property's vacancy represented over 80 percent of the total vacancy rate.

Annual absorption in Manatee County climbed ten-fold. Elsewhere in the county, construction was completed on 36,840 sf of space at Parkland Center, which was 37 percent pre-leased.

Sarasota, Pasco and Hernando counties together netted just 28,200 sf of absorption during the second quarter, up from a total net occupancy loss of 5,400 sf for the three counties last quarter. Construction was completed on 12,000 sf of hanger space at the Hernando County Airport, and an additional 9,000 sf was begun. All 21,000 sf is pre-leased.

In Polk County, Florida Central Industrial Park, located just north of Interstate 4 on U.S. Highway 27 in Davenport, was added to the survey. This park was first developed in 1999 and over a million sf of primarily distribution space has been built. This space increases Polk County's stock of gross leasable space by 14 percent. Inclusion of this park in prior year absorption figures raises Polk County's absorption to 711,030 sf in 1999 and to 727,010 sf in 2000.

Across the region there is 1.22 million sf of speculative space under construction. The pipeline of new space has slowed considerably with just an additional 378,200 sf announced for future construction. To this point in 2001, 585,455 sf of speculative space has been completed.

Quarterly data is revised as new information is obtained. For more detailed information on the survey, call the Maddux Report Research Department at 727/321-3225.

NOTE: Office buildings fully leased for two or more quarters do not appear in the survey charts. All office buildings are updated each quarter. Previous quarterly data is revised as new information is received. Survey charts may include sublease space, which is not included in analysis numbers.
For more complete information call the Maddux Report's Research Department at 727/321-3225.