El Paso's industrial market continues to contract, the vacancy rate increased significantly in the 1st quarter of 2010. The largest component of that increase was the closure of Jones Apparel's distribution center in Socorro, Tx. The 860,000 SF plant is one of the largest in El Paso and now the largest available Class "A" distribution space along the U.S. / Mexico border. There was an additional 250,000 SF of space coming on the market with Excel Logistics vacating a warehouse in Butterfield trail and Yazaki closing their warehouse in the Vista del Sol Sub market.
 
Several companies expanded their operations in El Paso. Express Point is relocating from Butterfield Trail into a 96,000 SF facility and Emerson moved into a 75,000 SF building in Vista del Sol, coming out of space with a 3PL in the same sub market. The remainder of the market activity was smaller operations renewing leases or taking on incremental space.
The industrial market continues to soften as demand from warehouse operation and suppliers supporting operations in Juarez appear to be at least 6 to 12 months off. As expected, the first half of 2010 looks to be slow and a repeat of 2009 on this side of the border. See below for an overview of the El Paso Industrial market for the 1st Quarter of 2010.
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Total Market Size: 54,270,000 SF
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Total Activity: 695,000 SF
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Gross Absorption: 333,000 SF
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Net Absorption: -884,000 SF
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New Construction: 40,000 SF
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Industrial Vacancy: 15.6%
Team NAFTA believes that the market is at the bottom of the cycle, there are no new vacancies expected for the 2nd quarter. Butterfield continues to be the sub market with the highest vacancy and the Westside has the lowest. With the exception of the Jones Apparel building in Socorro, Texas, the market for Class "A" distribution space over 200,000 SF is very tight. As the economy rebounds in the 2nd half of 2010 this will pose a problem for new 3PL requirements in El Paso.
Source: 2010 1st Quarter Market Summary: El Paso, Texas / Cd. Juarez, Mexico. www.TeamNAFTA.com.
Updated: April 2010
Statistics
Industrial Property Statistics |
|
2005 |
2006 |
2007 |
2008 |
2009 |
| Inventory (square feet) |
56,800,000 |
57,850,000 |
58,690,500 |
59,800,250 |
56,800,000 |
| Occupancy (in percent) |
90.5% |
92.6% |
93.8% |
91.5% |
90.5% |
| Net Absorption |
1,785,000 |
1,250,000 |
1,560,000 |
1,026,000 |
1,758,000 |
| Rental Range (per
square foot) |
$2.75 - $4.20 |
$3.30 - $6
|
$3.45 - $6 |
$3.45-$5.85 |
$2.75-$4.20 |
Source:
Sonny Brown Associates, LLC.
Updated: May 2010.
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Office
Property Statistics |
| |
2005 |
2006 |
2007 |
2008 |
2009 |
| Central Business
District |
|
|
|
| Inventory |
2,726,560 |
2,862,888 |
3,120,560 |
3,368,325 |
3,930,650
|
| Occupancy (in percent) |
68.0% |
72.4% |
76.0% |
80.3% |
76.0% |
| Net Absorption |
45,000 |
62,000 |
85,000 |
135,000 |
65,000 |
|
|
|
|
| Outside CBD |
|
|
|
| Inventory |
5,785,600 |
6,175,320 |
6,585,500 |
6,785,000 |
7,485,500 |
| Occupancy (in percent) |
87.0% |
82.5% |
91.0% |
89.7% |
89.0% |
| Net Absorption |
178,000 |
165,700 |
220,000 |
195,350 |
175,440 |
|
|
|
|
| Total |
|
|
|
| Inventory |
8,512,160 |
9,038,208 |
9,706,060 |
10,153,325 |
11,416,150 |
| Occupancy (in percent) |
87.0% |
74.8% |
80.9% |
81.3% |
82.3% |
| Net Absorption |
178,000 |
42,920 |
223,000 |
330,000 |
187,000 |
| Rental Range (per
square foot) |
$10 - $18 |
$10-$18 |
$12-$20 |
$12-$22 |
$12-$23 |
Source:
Sonny Brown Associates, LLC.
Updated: May 2010.
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