“Energy,” “Energy” and “Energy” — surprise, surprise, surprise — could have been the headlines over recent office, industrial and retail property market reports from CB Richard Ellis-Oklahoma.
Better late than never on this, by the way. It's a midyear report, but it came out late, and I'm just now getting to it here at the start of the fourth quarter.
Sorry about that. Thankfully, nothing has drastically changed since June — although commercial broker Gerald L. Gamble said the space shuffling that hit industrial as a result of the May 31 tornado is about over.
‘Energy' in office
Thriving “due to the robust energy and supporting industries,” according to CB Richard Ellis-Oklahoma.
The firm surveyed 144 office buildings 20,000 square feet and larger — a total of 14,553,078 square feet — and found a vacancy rate of 16.29 percent, almost flat compared with the end of last year.
The average lease rate slipped 2 cents to $15.21 per square foot per year, while the weighted average increased from $14.28 to $14.42, an indication the fast absorption of a large amount of lower-priced Class 3 space relative to Class B and Class A.
‘Energy' in industrial
“Energy continues to be the primary driving force of the market with other sectors also assisting in Oklahoma's push upward,” according to CB Richard Ellis-Oklahoma.
The firm said it tracks just under 100 million square feet of industrial space and now breaks the market down by submarket rather than building size:
Central business district, 7.51 percent vacant, rent $4.40 per square foot; northeast, 14.4 percent vacant, rent $3.95 per square foot; northwest (including Edmond), 10.56 percent vacant, rent $4.10 per square foot; southeast, 10.36 percent vacant, rent $3.60 per square foot; southwest (largest submarket by far, at least three times any others in amount of space), 10.6 percent, rent $4.12 per square foot; overall, 10.8 percent vacant, $4.02 per square foot.
Steady growth expected into 2014, the firm said.
‘Energy' in retail
OK, so it's a different kind of energy driving retail: consumers' renewed energy for consumption and national chains' post-recession efforts to make up for energy lost.
The south and Moore-Norman submarkets, again, were hottest: 19 Street and Interstate 35 in Moore; University Town Center in Norman, and I-35 and I-240 in south Oklahoma City.
The areas were humming despite the May 20 tornado that devastated Moore and part of south Oklahoma City, including a shopping center demolished and removed from the retail property rolls.
“National retailers continue to pay premium rates to find locations in these areas in an attempt to cater to a seemingly underserved market,” according to CB Richard Ellis-Oklahoma. “Notable deals in these submarkets include Hemispheres at Fritts Farm in Moore, Life Church and LA Fitness in Moore, and Crest Foods, HomeGoods, Michael's and DSW (Designer Show Warehouse) at University Town Center in Norman.”
The newest project on the south side is the return of former Crossroads Mall and its 1 million square feet to the retail property rolls under the name Plaza Mayor, a Hispanic-oriented mall, which, the firm noted, “will bring addition energy to the south submarket.”