Vacancy rates hit record highs, as new product delivers to the market
The Queen City shattered records in the second quarter of 2024, as overall vacancy increased 290 basis points (bps) in the past 12 months. Vacancy now totals 9.3%, up from 6.2% one year ago. Despite declines in construction starts and overall construction volume, deliveries remain steady. Q2 2024 totaled 3.6 million square feet (msf) of new deliveries, which is 48.0% higher than the five-year average of 1.9 msf. Of the new deliveries this quarter, five of the total of 13 buildings were 100.0% pre-leased. This includes Home Depot’s 710,000-square-foot (sf) build-to-suit in the Westinghouse Logistics Park. Looking ahead, expect new construction to deliver at high rates and with fewer tenants, as pre-leasing sits at only 33.0% of under-construction product.