The East Bay/Oakland industrial market ended the first quarter 2014 with a vacancy rate of 7.7%. The vacancy rate was down over the previous quarter, with net absorption for the link positive 1,367,136 ft.² in the first quarter. Vacant sublease space increased in the quarter, ending the quarter at 870,687 square feet. Rental rates ended at $8.25, an increase over the previous quarter. One building was delivered to the market totaling 374,725 square feet, with 2,355,436 square feet still under construction at the end of the quarter.
Net absorption for the overall East Bay/Oakland industrial market was positive 1,367,136 square feet in the first quarter. That compares to positive 757,969 square feet in the fourth quarter 2013, positive 1,477,385 square feet in the third quarter 2013, and positive 381,467 square feet in the second quarter 2013.
Tenants moving out of large blocks of space in 2014 include: Nor-Cal Moving Services moving out of 222,000 square feet at 2001 Marina Blvd., Kloechner Metals moving out of 161,500 square feet at 1699 W. Grand Ave., and Nitinol Devices & Components, Inc. moving out of 52,200 square feet at 255 Fournier Ave.
Tenants moving into large blocks of space in 2014 include: RonBow Corp. moving into 178,034 square feet at 7150 Patterson Pass Rd., East Bay Logistics, Inc. moving into 105,450 square feet at 1800 Merced St, and Chipman Corp. moving into 95,050 square feet at 1533 Zephyr Ave.
The flex building market recorded net absorption of positive 175,901 ft.² in the first quarter 2014, compared to positive 202,839 ft.² in the fourth quarter 2013, positive 319,783 in the third quarter 2013, and positive 333,377 in the second quarter 2013. The warehouse building market recorded net absorption of positive 1,191,235 square feet in the first quarter 2014, compared to positive 555,130 square feet in the fourth quarter 2013, positive 1,157,602 in the third quarter 2013, and positive 48,090 in the second quarter 2013.
The average quoted asking rental rate for available industrial space was $8.25 per square foot per year at the end of the first-quarter 2014 in the East Bay/Oakland market area. This represents a 3% increase in quoted rental rates from the end of the fourth quarter 2013, when rents were reported at $8.01 per square foot.
The average quoted rate within the flex sector was $12.34 per square foot at the end of the first quarter 2014, while warehouse rates stood at $6.68. At the end of the fourth quarter 2013, flex rates worth $12.10 per square foot and warehouse rates were $6.45 per square foot.