Business Leasing Mixed

Leasing was mixed across the Tampa Bay region business park market during the second quarter, with four counties making gains and three counties registering a drop in activity from the first quarter.

Hillsborough County saw net quarterly absorption of 218,270 sf, a modest gain over the first quarter, nudging the vacancy rate down slightly to 11.1 percent.

The sub-market east of I-275 recorded a 61 percent increase in quarterly absorption, seeing net leasing of 163,330 sf. The vacancy rate dropped to 12.7 percent while annual absorption climbed to 735,430 sf. Construction was completed during the quarter on 20,000 sf of speculative space at Eastshore Business Center.

West of I-275 quarterly absorption dropped 45 percent to 54,940 sf. Annual absorption dropped to 314,460 sf, while the vacancy rate slipped to 7.2 percent.

Net leasing was up 29 percent in Manatee County to 95,320 sf absorbed. The county's vacancy rate dipped to 8.4 percent, but 78 percent of the vacant space is at Palmetto Corporate Center. Factoring out this location, the vacancy rate was a low 2.1 percent. Construction was completed during the quarter on 21,000 sf at Parkland Center with Gem Air Distributors taking one-third of the space. Construction was also completed on 20,000 sf of manufacturing space for Rivolta Marine at Port Manatee. Annual absorption moved up to 370,890 sf.

Two new business parks were added to the survey in Pasco County, increasing the inventory by 17 percent. Gunn Highway Business Park is a nine-acre park in Odessa. Two build-to-suits have been completed totaling 79,000 sf; one lot was available in late July. Trinity Oaks Commerce Park is a 30-acre business park at the planned community of Trinity. Two build-to-suits have been completed there totaling 80,000 sf, while construction on a 50,000 sf build-to-suit began during the quarter. Adjusting for the absorption at these two parks over the last three quarters, Pasco's annual absorption has moved up to 250,300 sf. The vacancy rate is a low 2.6 percent with very little speculative space available. Construction was started during the quarter on 36,800 sf at One Pasco Center, of which 10,800 sf is speculative.

Hernando County reported quarterly absorption of 10,300 sf, all at Sunshine Grove Industrial Park. The county's vacancy rate is just .2 percent with only 3,600 sf available for lease. Annual absorption is just 1,400 sf. Two build-to-suits were started during the quarter at the Airport Industrial Park totaling 27,000 sf.

Quarterly absorption fell 65 percent in Pinellas County to 49,780 sf. Annual absorption dipped slightly to 787,320 sf while the vacancy rate slipped to 5.1 percent. The Pinellas Gateway suffered a net quarterly loss in occupancy of 19,020 sf, nudging the vacancy rate up a tick to 3.2 percent. Annual absorption slid 10 percent to 574,650 sf.

Polk County's quarterly absorption was 168,170 sf, down slightly from the first quarter. Polk has had four solid quarters of net absorption, pushing annual absorption to 829,590 sf Ð the second highest level in the region. The new Ruthven Center - Knights Station was added to the survey with 190,500 sf of space all absorbed over the past two quarters. An additional 178,500 sf of space is under construction at that site. The county's vacancy rate dropped a full point to a low 2.3 percent.

Sarasota County's net quarterly absorption was only 2,080 sf, which pushed annual absorption down 25 percent to 207,640 sf. The vacancy rate, however, is only 1.4 percent.

Across the region 1.49 million sf of speculative space is under construction, 40 percent of which is pre-leased. An additional 165,940 sf of space is under construction in build-to-suit projects at seven locations.