The occupancy rate in the New Hampshire industrial sector remained relatively flat, with a dip of 0.02% year-over-year, while rents increased by $0.21 PSF, or 3.1%. With occupancy remaining above 94%, a steady amount of owner-user construction was either started or completed during the quarter.
Two notable expansions broke ground; 13,000 SF at TRM Microwave in Bedford and 15,810 SF at Integra in Nashua. In Londonderry, MuShield completed its 6,000 SF expansion of manufacturing space on Ricker Avenue, bringing the total building up to 18,000 SF. This activity is a positive indicator for the industrial market and we hope this trend continues.
Due to the pandemic, some industrial companies are experiencing growth. Vapotherm announced plans to expand its manufacturing capabilities due to COVID and could add 350 manufacturing jobs in Exeter. The company is focused on developing and commercializing its HI-VNI technology products used to treat patients in respiratory distress. Lydall, a Rochester company, is ramping up manufacturing efforts to produce more N95 respirators and surgical masks, adding two new production lines. The company plans to produce five times its current capacity by May 2021, creating a need for more employees as well. These are just a couple examples of manufacturing companies thriving, which could lead to an increased need for production space in the state.
As NH moves through the pandemic, much is unknown of the long-term impact this will have on commercial real estate. The industrial market has such a high demand for space, occupancy rates will most likely stay strong. We will need to distance ourselves further from the pandemic to fully understand the lasting impact it will have on the commercial real estate market.
At Colliers International in New Hampshire and Maine, we internally track over 67.4M SF of industrial space across 6 submarkets in New Hampshire. Our inventory includes buildings and condominiums 10,000+ SF and are classified as manufacturing (MFG), flex/R&D, or warehouse/distribution (W/D).
