Industrial

The 195 million-square-foot Washington, D.C., metropolitan industrial market features various sectors and centers of demand across the region. The overall market has been extremely healthy, with unique forces impacting the area’s primary regions of Northern Virginia, Suburban Maryland and Washington, D.C. The overall metro market expanded between first-quarter 2017 and first-quarter 2018. Net absorption in the period was 1.7 million square feet, albeit a significant slowdown from the previous 12-month cycle (4.2 million square feet). After falling significantly during the past five years, vacancy remained relatively flat in first-quarter 2018 and settled at 6.8 percent, a 10-basis-point drop year-over-year. A lack of available space limited opportunities for occupancy gains but allowed owners to increase asking rents. The average asking rent rose sharply to $10.04 per square foot, up from $9.58 per square foot one year earlier. Of the 1.9 million square feet of new supply under construction, 1.3 million square feet was in Northern Virginia’s less constrained but in-demand Loudoun County. Overall new supply was 55 percent preleased at the end of the first quarter. The Washington metro industrial market inside the Interstate 495 Beltway contrasts in many ways to the market outside the Beltway. The most significant difference is …