Despite a drop in the vacancy rate, Saskatoon is seeing a mounting inventory of complete and empty new industrial space, according to a report from ICR Commercial.
ICR found that 134,700 square feet of industrial is under construction but that 63 per cent of the 365,000 square feet completed this year remains unoccupied.
Supply continues to over-exceed demand for industrial condominiums as well, as 60 per cent of the approximately 143,600 square feet of new product remains unsold. New industrial condos sell for an average of $180 per square foot.
Saskatoon now has 17.5 million square feet of industrial space, an increase of 1 million square feet in the past two years. The overall vacancy rate is 5.9 per cent, ICR reports, down from 7.3 per cent one year ago but up from 3.8 per cent in 2011 when the building boom got underway.
Lease rates for new product, at an average of $12.50 per square foot, have not budged from last year. Lease rates for older buildings average $10 a square foot.
from Western Investor November 2013