Oklahoma City to Experience Above-Average Industrial Development Activity in 2019
admin / May 2019
More Than 3 Million Square Feet of Industrial Space is Projected to be Completed This Year
While only a handful of industrial projects have been completed so far this year, Oklahoma City is set to receive one of the highest levels of completed industrial space this cycle.
Currently, data forecasts more than 3 million of square feet of industrial space is projected to be built in Oklahoma City. The current cycle peak for development occurred in 2016 when about 3.7 million square feet of space was completed, anchored by Hobby Lobby’s nearly 2 million-square-foot facility and Boeing’s 315,000-square-foot warehouse.
A rise in development in 2019 comes to no surprise as Amazon’s 2.56-million-square-foot fulfillment center is set to be completed this fall. In May 2018, Amazon announced it was planning to open its first ever fulfillment center in the state in Oklahoma City. The property, which started being constructed in September 2018, is located in the Southwest portion of Oklahoma City near Will Rogers Airport, an area that has seen persistent development this cycle and has seen its inventory of industrial space grow by about 30%.
While build-to-suit projects like the Amazon facility have been popular in the metro area since Jan. 2010, most of the development underway is available for lease. Aside from the Amazon development, nearly 90% of the under-construction space in the Oklahoma City market is available, as of early May.
Some of the more notable projects currently under construction in the metro area is the 172,000 square-foot logistics center at 3700 S Purdue Ave. and the nearly 90,000-square-foot warehouse at 3401 S. Council Road. Both are located in the Southwest area of the metro area and are currently available for lease.
The owner/user nature of Oklahoma City has kept vacancies low. Several major tenants have landed in the metro area in recent years, but the one of the area’s largest employers has continued to drive development.
Hobby Lobby has opened several distribution facilities in the Southwest since the beginning of 2010, totaling around 4 million square-feet of inventory. The arts and crafts retailer recently completed an additional 1-million-square-foot distribution building in 2018. Thanks in large part to these build-to-suit projects, more than 95% of space delivered across the metro area since the start of 2010 is occupied.
Overall, vacancy rates in Oklahoma City are near their lowest level in more than a decade, at about 4% as of May.
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