2012 Global Market report - NAI Global

Berks County, Pennsylvania
Bucks County, Pennsylvania
Contact
NAI Keystone
Commercial & Industrial
+1 610 779 1400
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
Total Population
Median Age
564,838
585,397
289,225
$61,593
$49,726
40
Food processing, plastics, metals, battery manufacturing
and the packaging industry are all growing industries in
Berks County. PCA just completed a 225,000 SF flagship
corrugated box plant in Muhlenberg Township. Medical and
institutional users are key office drivers with less little growth
coming from new construction. After three years of negative
absorption the office market is flat with gains made in the
Wyomissing/Spring Ridge area offsetting the negative
absorption in Downtown Reading.
Industrial vacancies, excluding subleases, are flat after two
years of negative absorption of one million SF. Several new
construction projects have emerged and rates remain stable
with landlord concessions routine. Leasing activity remains
up as many users cannot obtain financing to purchase.
Gross sales of industrial product were down $8 million over
the prior year to $15 million total. Sale prices were down
only slightly with a range of $45 to $19/SF for Class A to
Class C respectively.
Overall office rates remain down but are stable and quality
downtown space can be found at $10/SF gross which
should bring deals in from the suburbs. Developers have
700,000 SF of office space planned and approved just
waiting for demand. Medical and financial activities account
for most deals.
The number of residential units sold is down 7.5% and
average sale prices are down 8% from the prior year.
Developers continue to sit on projects with more than 2,000
approved, but unimproved lots ready.
The Route 61/I-78 interchange continues to grow rapidly
with retail and hotel projects created from the millions of
visitors that sporting goods giant Cabelas attracts. Planning
has slowed for large centers but continues for pharmacies
and value based grocery stores. The BOSS 2020 program
is projected to enhance the traffic flow in Sinking Spring and
transform the retail and commercial area. A Technology Park
is planned for development at the Reading/Berks Airport and
watch for the emergence of Bryne Eyre, a 3,000 acre PRD
at the I-176 and PA Turnpike interchange.
Contact
NAI Mertz
+1 215 221 1100
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
Total Population
Median Age
627,026
634,201
342,367
$97,028
$77,111
40
Inventory for leases remains readily available while
properties for sale were in greater supply than the previous
year. Sale prices declined another 5% to 10% and product
has remained on the market for a considerably longer period
of time. Lease rates remain aggressive but with less landlord
concessions. The office market has marked improvement
due to the growing healthcare industry. The industrial
market improved and with the help of hi-tech and heavy
manufacturing interest, this trend should continue.
Bucks County continues to receive global interest as heavy
manufacturing/hi-tech/alternative energy companies seek
power, rail, port and economic incentives offered within
Keystone Industrial Port Complex (KIPC) in Morrisville. NAI
Mertz works with NAI Global as exclusive agent for KIPC. A
designated KOIZ, it adds 1,259 acres of heavy industrial
zoned land to the 44,000 acres of developable land within
Pennsylvania’s KOZs. The industrial market totals
58,000,000 SF. Vacancy rates decreased 1% last year to
10% including all sublease opportunities. The market
showed a positive absorption of 750,000± SF this year,
outperforming its neighbors. Notable transactions include
Costco’s 150,000 SF build to suit on 15+ acres in Warminster;
150,000 SF sale at 1 Progress Drive, Morrisville; and sale
of 110,000 SF at 1050 Wheeler Way in Langhorne.
The Bucks County office market is strong. Activity is
steadfast and rates have stabilized. The troubled financial
sector created a large percentage of vacancies which are
being absorbed by the rapidly growing healthcare industry.
Notable lease transactions include former ICT Headquarters
of 35,400 SF in Newtown Corporate Center to Waste
Management of Pennsylvania, ITT Technical Institute
leased 28,063 SF at I-95 Technology Center in Levittown,
Northwestern Human Services leased 20,000 SF in Trevose
and Penndel Mental Health leased 18,333 SF at Bucks
County Business Park in Langhorne.
The retail market showed similarities with Philadelphia
County with the slight reduction of rental rates and rise of
vacancies during 2011. Retail attractions such as New
Hope, Washington’s Crossing and Peddler’s Village are
partially supported by tourism. New projects under way are
Hilltown Promanade, a 475,000 SF power center in Hilltown,
a 50,000 SF addition at Richland Marketplace and a
440,000 SF center in Quakertown.
Berks County At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
$
$
$
$
$
$
15.00
12.00
8.00
18.00
16.00
13.50
$ 18.00
$ 15.50
$ 12.50
$ 21.00
$ 21.00
$ 18.00
$ 17.00
$ 14.25
$ 12.00
$ 19.00
$ 18.00
$ 15.30
N/A
7.00%
23.50%
N/A
13.90%
12.10%
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
Downtown
$
$
$
$
2.00
2.50
6.00
8.00
$
$
$
4.00
4.00
8.50
N/A
$
$
$
3.35
3.25
7.50
N/A
17.10%
17.00%
10.00%
12.00%
Neighborhood Service Centers
Community Power Center
Regional Malls
$
$
$
18.00
11.00
10.00
$ 30.00
$ 15.00
$ 16.67
$ 24.50
$ 13.00
$ 13.33
16.00%
12.00%
18.00%
deVeloPment land Low/Acre High/Acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
$
$
$
N/A
50,000.00
50,000.00
40,000.00
$
$
$
N/A
90,000.00
80,000.00
60,000.00
Retail/Commercial Land
N/A $ 1,250,000.00
Residential
$ 15,000.00 $ 40,000.00
Bucks County At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
N/A
N/A
N/A
$ 18.35
$ 16.75
N/A
N/A
N/A
$ 26.58
$ 33.00
N/A
N/A
N/A
$ 23.34
$ 24.87
N/A
N/A
N/A
N/A
32.00%
Class B (Secondary)
IndustrIal
$ 6.50 $ 27.58 $ 19.04 17.00%
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
$
$
$
2.75
2.75
6.50
$
$
$
4.75
6.50
8.50
$
$
$
3.75
4.00
6.50
10.00%
8.00%
5.00%
Downtown
Neighborhood Service Centers
Community Power Center
Regional Malls
$ 12.00
$ 15.00
$ 20.00
N/A
$ 30.00
$ 20.00
$ 35.00
N/A
$ 21.00
$ 17.50
$ 27.50
N/A
10.00%
9.50%
9.00%
N/A
deVeloPment land Low/Acre High/Acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
Residential
$
$
$
N/A
130,000.00
125,000.00
90,000.00
N/A
N/A
$
$
$
N/A
490,000.00
175,000.00
175,000.00
N/A
N/A
2012 Global Market Report n www.naiglobal.com 128