Industrial Snapshot Q3 2014

Comments Off on Industrial Snapshot Q3 2014

ECONOMIC OVERVIEW

JOBS1stPA, an economic recovery program launched in 2012 by Governor Corbett’s administration and aimed at creating and retaining private-sector jobs in Pennsylvania, was hard at work in the Pittsburgh region throughout the Q3 2014 period. Companies such as Karndean Flooring and Siemens Rail Automation announced expansion plans made possible through the program. Karndean, a global interiors manufacturer, is doubling the size of its Westmoreland County facility, retaining 69 existing positions and adding 38 new jobs. Siemens has leased 38,300 square feet (sf) at The Waterfront in Pittsburgh’s Homestead neighborhood where it will consolidate two other locations in the region. The engineering company expects to add 129 new jobs to its existing staff of 93.

Pittsburgh’s unemployment was just 5.7% and an additional 9,200 jobs were added to the region during the most recent 12 month period ending at the conclusion of Q3 2014.

DISTRIBUTION USERS DRIVE LEASING ACTIVITY

Although year-to-date (YTD) leasing activity is down 22.7% from this time last year, finishing the quarter at just 2.3 million square feet (sf), there is at least one transaction worth mentioning.  Amazon.com’s entrance to the Pittsburgh market dominated much of the business sector’s conversation in Q3 2014. The internet giant inked a deal to occupy more than 300,000 sf at 2250 Roswell Drive in Pittsburgh’s Parkway West submarket. The company plans to hire more than 100 workers to establish a sorting center that will enable it to expedite overnight and same-day delivery commitments.

DEVELOPERS TARGET BUILD-TO-SUIT REQUIREMENTS

Fourth River Development began construction on is 104,000-sf industrial building at Starpointe Business Park. The property’s first tenant will be Mach1Global, who will occupy more than half of the building upon completion.

Sippel Development announced plans to construct a 305,000-sf distribution facility in Jackson Township, Butler County submarket, on behalf of FedEx, who is looking to establish a new distribution facility in the market. And, General Industries released its concept for Concorde Pointe, a new $100-million light industrial park that will be constructed on a 110-acre stretch of open land in Rostraver, Westmoreland County. The company plans to target energy companies with 25,000-sf to 250,000-sf warehouse and light industrial requirements for its 30-building project. In addition, the developer intends to add retail and restaurants to provide additional amenities for tenants.

OUTLOOK

The Pittsburgh region has all of the right assets economically to meet the growing needs of industrial users emerging in the U.S. save one: large warehouse/distribution facilities or adequate pad-ready sites for development. As a result, leasing activity is expected to continue to decline as vacancy and rental rates increase. Public-private partnerships formed to respond to this growing need can help Southwestern Pennsylvania remain competitive but timing is of the essence

View Attachment

Author: Edie Hartman

Comments are closed.