Big Box Development Expands, Vacancy Rate Increases
Demand for modern big box buildings, as measured by net absorption, was positive during the second quarter, totaling 3.1 million square feet, bringing the tally for the first half of 2019 to an impressive 6.9 million square feet.
Despite strong demand, the big box vacancy rate increased by nine basis points to 8.62 percent between April and June due to the completion of seven speculative big box construction projects totaling 3.4 million square feet. These new buildings were delivered 78 percent vacant, adding 2.6 million square feet of new vacant space to the big box market.
New leases and lease expansions in big box buildings totaled 4.0 million square feet among 22 leases during the second quarter of 2019, bringing the year-to-date total to 8.9 million square feet among 45 leases.