The beginning half of 2014 ended with the Downtown Providence Office vacancy rate decreasing to 15.07% from 16.20% at the end of 2013. There were several transactions that impacted this result including the purchase of the 25,253 sq. ft. 180 South Main Street by the Rhode Island Attorney General’s Office and the sale of the 20,000 sq. ft. 189 Canal Street to Rhode Island School of Design. This removed ±45,253 sq. ft. of vacancy from the market.
At mid-year 2014, the Rhode Island Industrial market vacancy rate is 7.9%, down 106 basis points from 9.03% at year-end 2013. Significant leasing and sales activity contributed to the strong reduction. The overall size of the Rhode Island Industrial market increased slightly with the addition of 175,000 sq. ft. for a total market size of 52,424,000 sq. ft. There was positive net absorption of 869,454 sq. ft. in the first half of 2014, compared to 23,894 sq. ft. in the second half of 2013. The Rhode Island industrial market continues to see improvement in many areas and increased tenant activity in all size ranges. With vacancy down and absorption up significantly, the industrial market is trending to a much healthier overall condition. The limited supply of quality inventory for both sale and lease product will present a challenge for prospects as we move forward into the second half of 2014.