Colliers International's research team in Philadelphia, led by Rose Penny, Director of Research, relentlessly tracks market activity, stays on top of the news, collaborates with brokers in the field, wrangles the data and then applies their expertise to forecast what’s next. They are an invaluable resource to our service offerings here at Colliers and quarterly we make all of it available to you. Don’t miss this latest edition covering the Eastern Pennsylvania, Southern New Jersey and Delaware Office, Industrial, Retail and Investment sectors.
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Here are some of the key takeaways we see reflecting back on the final quarter of the year:
Year End Regional Office Highlights
- The regional office market vacancy has been fluctuating by quarter and by submarket and ended 2018 at 12.2%.
- Year-to-date absorption approached 2 million square feet, a substantial portion of which was attributed to the completion of the Comcast Technology Center.
- Asking rents increased by 3.1% from the end of the second quarter to a regional average of $27.04 per square foot, full service. The average Class A rent increased by 3.0% and the Class B average by 2.6%.
- Suburban investment volume remained high, while there was a pause in CBD sales activity.
Year End Regional Industrial Highlights
- Regional vacancy rate decreased to 5.9% during the last two quarters of 2018.
- Year-to-date absorption topped 15.3 million square feet, but was below the annual totals for 2016 and 2017.
- Asking rents increased by 3.1% year over year.
- Construction deliveries were also behind the pace of the last two years, but still at a robust level of 16.7 million square feet.
- User and investor sales volume was down by 33% from 2017.
- Limited supply of buildings to purchase pushed user sales down by 50%.
Year End Regional Retail Highlights
- The regional vacancy rate has been steadily climbing, reaching 9.2% at the end of the fourth quarter.
- Vacant anchor stores continue to pose challenges for owners.
- Asking rents have remained stable, but may begin to trend downward for centers with persistent vacancies.
- Investment sales volume was very limited for the year.
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