Boise Commercial Real Estate Review for September

Sept. 20, 2012 - PRLog -- (Boise, Idaho) -- Boise Commercial Real Estate Review for September 2012 from Thornton Oliver Keller Commercial Real Estate.

Office Review

Total vacancy remained flat at 12.6%, while multi-tenant vacancy increased slightly from 17.7% to 17.8% in August. Central (16.9%), Downtown (6.7%), Southeast (9.5%), Meridian (12.0%) and South Meridian (10.2%) continue to see declining vacancy, however the Caldwell Blvd submarket in Nampa has posted 5 straight months of vacancy increases. Even with the rise in vacancy, Caldwell Blvd has the lowest projected supply, mostly due to a lack of inventory. North Boise’s vacancy (16.9%) increased over 100 basis points when a government agency vacated 12,000 SF on State Street. Projected supply declined to 25 months from 30 months at the beginning of 2012. Overall lease rates, both asking and actual, continue to increase, while Class A rates saw a slight decline this quarter.

Industrial Review

Total vacancy declined from 9.6% to 9.1% in August. Multi-tenant vacancy continued its decline last month, ending the month at 17.7%. The Caldwell submarket saw a great improvement in vacancy and absorption when the 100,200 SF former Caldwell Manufacturing plant leased to Treasure Valley Seed. Vacancy in Caldwell dropped from 15.6% to 10.1% last month, its all-time low. In the Idaho Center submarket of Nampa, 23,100 SF on Star Road leased to Pioneer Hi-Bred International. Vacancy in the Idaho Center submarket dropped to 2.6%, overtaking the Airport submarket (3.1%) for the lowest vacancy. Projected supply continues to improve and is currently 22 months. Actual lease rates, while up from 2011, declined slightly from the first half of 2012 to $0.36/SF.

Retail Review

Total vacancy increased slightly in August, from 8.4% to 8.6%. Most of this increase is focused at one intersection - Eagle & Fairview. The Village at Meridian on the NEC saw many buildings completed in August, some with vacant space. Big Al’s, Gordmans, Marshalls,  Petco and Nike Factory Outlet leased space in the new power center. Marshalls and Nike Factory Outlet vacated space of similar size across the street at Meridian Crossroads creating no impact on net absorption. North Boise’s vacancy (12.6%) declined to  its lowest point since mid-2005 when 11,300 SF leased to Vertical Church at Glenwood City Centre. Projected supply for retail continues to be the lowest of the three specialties (21 months). Actual lease rates are up nearly $1.50/SF over 2011 for both Class A and Overall.