By Jarrett Hicks, Senior Research Analyst
A key development in the third quarter was the 1.5 million square feet of new construction deliveries. Over 1.3 million square feet of the deliveries were speculative bulk projects in Richwood, KY and West Chester, OH. Over and above the delivered space, a sizeable 3.1 million square feet of industrial space is currently under construction across the region, the majority of which is speculative bulk product in Northern Kentucky. Dermody Properties’ 898,560 square foot LogistiCenter 275 in Erlanger, which has been pre-leased by Wayfair, broke ground in Q3. IDI Gazeley also recently broke ground on the 442,304 square foot Park South at Richwood I.
After a 15-year low of 4.42% in the second quarter of 2015, overall vacancy in Greater Cincinnati increased slightly to 4.57%. With the delivery of over 1 million square feet of new bulk warehouse space, quarter-to-quarter Class A bulk vacancy increased from 1.3% to 3.1%. Conversely, Class B bulk vacancy decreased by more than 100 basis points since last quarter, due to leases in the Central and Northern Kentucky submarkets. Vacancy was virtually unchanged in the other product types since the last quarter.