Real Estate: Industrial & Commercial

Around metro Albuquerque, there are 35 million square feet of space for industrial activity, with about six percent vacant as of the fall of 2007. The vacancy rate nationally is 10%. Cities around the region such as Tucson, Dallas and Denver have a higher vacancy rate than Albuquerque.  During 2007, there were 1.5 million square feet absorbed by new activity. Much of the absorption came in two pieces, the Tempur-Pedic mattress factory and Albuquerque Studios film facility in the Mesa del Sol development. Land ready for industrial development costs around $10 per square foot. The supply is quite limited.

Office space in Albuquerque is 11% vacant, the lowest rate in recent memory. Albuquerque has 15 square feet of office space per capita, comparable to Salt Lake City and Phoenix and double the space in Tucson. Projections of past growth suggest the need for 2.5 million square feet of new office space over the next nine years or about 280,000 square feet per year. Guarded optimist is the office market outlook for 2008 with the vacancy rate up a bit and rents flat to down.

The figures and the outlook are from the Albuquerque chapter of the Society of Industrial and Office Realtors. The group spoke to NAIOP, the commercial developers organization, in late November.