Construction pipeline yields plenty of available space. During 2017, 1.46 million sq. ft. has been delivered to the market, with 68% of that new supply available for lease. Overall net absorption is at 1.02 million sq. ft., nudging vacancy up 20 basis points to 5.9% year-to-date compared to Q3 2017 at 5.7%. The current amount of space under construction is 869,207 sq. ft., with 24% of that space pre-leased. In a tight market, leasing activity is at close to 3.8 million sq. ft. year-to-date.
Major technology company purchases data center. Microsoft Corporation acquired an $80-million data center in far west San Antonio, as part of an ongoing effort to amass data centers in the metro area. The 202,000-sq.-ft. property sits on 34 acres at 5200 Rogers Rd. in Westover Hills. Chevron Corp. had previously owned the flex/data center since 2011.
Investment sales up 66% year-over-year. Sales of major industrial properties grew 66.1% on a year-over-year basis mid-way through the fourth quarter, totaling $423 million, based on Real Capital Analytics data. The buyer composition is made up of 37% cross-border, 36% private, 12% REIT/listed, 8% institutional and 7% user/other. The most recent significant year-to-date transaction in the local market took place in August: the acquisition by Stonemont Financial of an eight-building, 184,589-sq.-ft. industrial/flex property, Weatherford – Eagle Ford Headquarters, at 19685 I-37 S., in south San Antonio, from Oak Street RE Capital.
Economy grows at a strong pace in September. The San Antonio economy continued to grow at a robust pace in September, as jobs grew moderately and the area unemployment rate declined to 3.9%, slightly below the state rate of 4.0 and the national rate of 4.2%. Unlike state and national job growth, which declined due to the impacts of the recent hurricanes, San Antonio saw a healthy 3.5% annualized increase in employment.
Director of Research
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