Scantly Available Space Inhibits Market Growth
Tight conditions persisted for Oahu’s industrial market as the Q2 2022 vacancy rate fell to 1.38%, the lowest in recorded history. While the quarter recorded 24,075 square feet of occupancy growth, this limited net absorption was primarily a reflection of the lack of available space on the market rather than a reduction in tenant demand.
A challenge that prospective tenants face is the lack of available listings on the market for lease. At the end of Q2 2022, only 63 industrial spaces existed for lease, a new record low. The “bread and butter” of Oahu’s industrial market are tenants looking for warehouse spaces under 4,000 square feet. However, between Q4 2020 and Q2 2022, listings under 4,000 square feet declined from 137 to 29, a dramatic 78.8% decline. The lack of industrial space options will inhibit growth for many businesses and prevent them from meeting their full potential.
Oahu’s industrial vacancy rate fell to a historic low of 1.38%
Occupancy growth was limited to only 24,075 square feet for Q2 2022
Direct weighted average asking base rent hit a record high of $1.37/psf/mo
A slowing economy will impact the industrial market