www.orlandosentinel.com/business/orl-commreal1508may15, -
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Published on: 5/15/2008
Last Visited: 5/15/2008
Rebman industrial specialist Lyle Nelsen said in his closely watched quarterly report that vacancy rates are still rising.The south Orlando submarket is the biggest in Central Florida, with 128 service-center and "flex space" buildings south of the State Road 408 expressway.With more than 1 million square feet of space available in that submarket, the vacancy rate jumped to 12.9 percent in the first quarter, up 5.4 percentage points from a year earlier.
"The attitude that leasing agents are taking is to be patient, hold the line on rates and any further development until the economic climates changes" for the better, Nelsen said.
The south Orlando market survey found 1.15 million square feet of space vacant plus another 90,000 square feet under construction and scheduled for completion this year, for an available total of more than 1.24 million square feet.At the current rate of "absorption," that is about 2.5 years' worth of inventory.
Nelsen said in his analysis that the "painfully slow" first quarter was weighed down by "the impact of the housing market collapse, increased fuel costs ,and, a protracted election process."Many small tenants are "running out of cash and turning in their keys," he said.
Six service-center/flex-space leases of more than 5,000 square feet were signed during the quarter, Nelsen found.
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Nelsen said the one bright spot he found during his latest survey was that agents generally said their "phone was still ringing," deals were in the works and leasing concessions were on the rise.
"We haven't experienced challenging economic times like this in many years," Nelsen said in an analysis sent to his commercial clients.