Commercial Real Estate Review for July 2013 from TOK Commercial

July 16, 2013 - PRLog -- Office Review
Total vacancy declined from 12.6% to 11.6% in June, its lowest point since Q1 of 2008. Multi-tenant vacancy improved as well, dropping from 18.8% to 17.2%. Much of this improvement can be attributed to one large deal in West Boise. Maximus, a new healthcare call center, leased 176,500 SF, dropping West Boise’s vacancy rate to 14.1%, its lowest point since 2006. Projected supply in West Boise dropped from 37 months to 23 months as a result of this transaction. Net absorption for the market turned from -19,000 SF in May to +197,000 SF at the end of June. Q2 had the strongest net absorption since early 2007. Vacancy in Southeast Boise (8.9%) also dropped in June when Boise State University expanded their presence by leasing 11,900 SF in University Plaza on Broadway.

Industrial Review
In June, total vacancy and multi-tenant vacancy declined in June to 9.1% and 16.4% respectively. Multi-tenant vacancy is at its lowest point since mid-2008. The Airport submarket turned from negative absorption to positive last month when Glaz-Tech occupied a 56,600 SF building on Amity Road. They vacated 32,000 SF in the Idaho Center submarket of Nampa, pushing vacancy to 4.4%, a 12-month high but still well below the market average. Two deals totaling 35,000 SF occurred in Caldwell, dropping vacancy in the submarket to a historical low of 6.9%. Home Brew Stuff purchased a 14,000 SF building in West Boise. Vacancy in West Boise dropped to 12.3% as a result, its lowest point since early 2010 and well below its high of 17.4% at the peak of the recession.

Retail Review
Total vacancy improved slightly from 8.9% to 8.8% in June. Unanchored vacancy also declined from 16.7% to 16.4%, its lowest point since mid-2007. The Village at Meridian signed two new tenants last month: Which Wich (a sandwich shop) is new to the valley and Sleep Train will open its 2nd location in a shops building on Eagle Road. These two tenants leased a combined 6,000 SF, dropping Meridian’s vacancy to 8.5%. Central Boise (7.8%), Downtown (6.6%), North Boise (12.0%) and Caldwell (6.1%) saw improving vacancy as well in June. Midway through the year, net absorption is 16,000 SF for the retail market, but it is projected to end the year around 400,000 SF when additional construction is completed at The Village and the new Walmart near Overland & Meridian is finished later this summer.

For more information on commercial real estate in Boise, the Treasure Valley and the surrounding area, please contact Thornton Oliver Keller at http://www.tokcommercial.com.