The net takeover of over 392,000 square feet, far more than the 38,000 square feet in the first quarter, is another sign of the companies’ drive to create industrial space in the city.
“Strong demand for industrial space in New York City continues to be a bright spot in the real estate market,” said Nicole LaRusso, senior director of research and analytics at CBRE. “The quarterly decline in leasing activity reflects a shortage of Class A vacant space to meet this demand.”
According to the report, a total of 52 lease deals for industrial premises were concluded in the second quarter. They have been split into 25 deals in over 288,000 square feet in Queens, 19 in more than 154,000 square feet in Brooklyn and eight in nearly 142,000 square feet in the Bronx.
The largest lease in the second quarter was Seko Worldwide, occupying 50,500 square feet at 14909 183rd Street in Queens, followed by 25,700 square feet Urban Soccer at 1700 Atlantic Ave. in Brooklyn and the LTS Management Company, which occupied 20,000 square feet at 59-00 Decatur. St. in Queens.
There were no major e-commerce leases in the second quarter, again due to space constraints, according to the report.
The industrial sector also generated 43 investment sales valued at over $ 700 million and nearly 1.7 million square feet, more than 200% more than the 530,000 square feet of industrial space sold in the first quarter.
According to the report, supply should come close to matching demand, as 13 industrial properties are currently under construction with a total area of approximately 3.8 million square feet and 19 additional properties planned or proposed in excess of 6.5 million square feet. The projects under construction include over 2.6 million square feet of Class A warehouse and distribution space and 650,000 square feet of television and film studio space.
But only one large industrial building was built in the last quarter: 568 Meserole St. in East Williamsburg, which brought 90,000 square feet of Class B industrial space to market. The only real estate to get off the ground is 595-659 Smith St. at Red Hook, which will bring 232,000 square feet of warehouse space to market and is due for completion later this year.