2019-07-10_DTZ戴德梁行_Office_Q2_2019_Binghamton,NY_2页_430kb

Binghamton Office Market Q2 2019 Summary

Core Content

This document provides a detailed overview of the Binghamton, NY office market for Q2 2019, including economic indicators, market performance, and key transactions. It is produced by Cushman & Wakefield and Pyramid Brokerage Company, and highlights the ongoing changes in the local economy and real estate market.

Economic Indicators

• Binghamton Employment: Slightly declined from 102.9 in Q2 18 to 102.3 in Q2 19.
• Binghamton Unemployment: Decreased from 4.4% to 3.9%.
• U.S. Unemployment: Decreased from 3.9% to 3.6%.
• Population and Labor Force: Continued to decline, despite the drop in unemployment.
• Industrial Trends: Electronics manufacturing is shrinking, while warehousing, general manufacturing, and employment in education and medicine are growing. The hemp industry is emerging as a potential new sector with investment opportunities.

Market Indicators (Overall, All Classes)

• Rental rates reflect NNN asking $psf/year.

• Vacancy: Increased by 10 basis points (bps) to 8.0%.
• Net Absorption: Turned slightly negative at -8.3k sq ft.
• Average Asking Rent: Rose to $13.81 per sq ft, up from $12.84 in Q2 18.
• Market Trends: The increasing availability of office buildings for user-occupancy is expected to continue, positively impacting market activity.

Market Overview

• Net Absorption: Negative in Q2 2019 due to several small office buildings being placed on the market.
• Vacancy Rate: Increased slightly to 8.0%, but was balanced by leasing activity.
• Average Asking Rent: Remained unchanged at $13.81 per sq ft for the first and second quarters of 2019, but increased from $13.20 at the end of 2018.
• Key Transaction: The sale of the 155,000-sq ft former Sears building is expected to impact the office market, with several sizeable office leases planned for the property.

Outlook

• Hemp Industry: New York State investment in the hemp industry has led to interest in industrial properties from down-sizing industries.
• Major Transaction: A 300,000-sq ft manufacturing plant was sold from electronic assembly to hemp processing and product development in Q2 2019.
• Other Sales: Several other industrial facilities, ranging from 60,000 to over 250,000 sq ft, are under contract or in negotiation for sale to hemp processors.
• Employment Impact: These transactions are expected to have a significant impact on employment in the new hemp manufacturing sector.
• Redevelopment: Ongoing redevelopment includes Binghamton University converting a pre-World War II shoe factory into a nursing campus in Johnson City, and a 100-unit market rate housing project near completion in a former film and camera factory in Binghamton.
• Major Employers: The economic position of major local employers, including BAE, Lockheed, and Raymond Corporation, continues to strengthen.

Submarket Analysis

Overall Market

• Inventory (SF): 4,649,030
• Sublet Vacant (SF): 0
• Direct Vacant (SF): 373,879
• Overall Vacancy Rate: 8.0%
• YTD Net Absorption (SF): -11,400
• YTD Leasing Activity (SF): 13,290
• Average Asking Rent (All Classes): $13.81

Submarket Details

Key Lease Transactions 2019

Key Sales Transactions 2019

This summary highlights the evolving dynamics of the Binghamton office market, with a focus on economic trends, vacancy rates, rental prices, and significant real estate transactions.