Hawaii's Industrial Market is a Landlord's Market!

Hawaii’s industrial real estate market continued to tighten up in the first quarter of this year, which has fueled increased competition for the limited warehouse space still in the market, according to a new report.

The first quarter industrial report from CBRE Inc. said that the vacancy rate spiraled down to 2.2 percent from 3.5 percent the same time period a year ago.

“It’s a landlord’s market,” CBRE Executive Vice President Dana Peiterson told PBN. “Typically, when we get to this level, we start to see new product. For the first time in a long time, we are seeing speculative developments.”

New projects in the works are located in areas of Kapolei and Kailua, he said.

Other signs of the tight market that Hawaii is currently witnessing include base lease rents increasing and leasing activity heading north when comparing year-over-year totals.

Industrial leasing activity of warehouse space for the first quarter increased about 13 percent compared to the same time period last year.

Demand for space in the Honolulu core remained strong as base rents increased 3.1 percent to 99 cents per square foot per month from 96 cents per square foot per month.

Looking ahead, rents should continue to rise and the demand for new and improved industrial warehouse space still remains, the report said.

Foreclosure Proceedings in Hawaii Declined 9% in March

According to a report from RealtyTrac, a real estate data service based in Irvine, Calif., "One out of every 1,850 homes in Hawaii were in some stage of foreclosure in March. Nationwide, foreclosure filings, including default notices, scheduled auctions and bank repossessions, were reported for 117,485 properties in March, the company said, a decrease of 23 percent compared to March 2013.

Daren Blomquist, vice president at RealtyTrac, said in a statement, “Now that the foreclosure deluge has dried up, banks are turning their attention back to properties that have been sitting in foreclosure limbo for some time,”

While Hawaii has always had a low percentage of foreclosures, certain areas of each island tend to see more than others.  Those areas are usually ones in Rural parts of the island, where recent new development has increased the inventory, making older homes less desirable and harder to sell.  

Oahu Housing Market continues to Soar

Oahu’s housing market continued on a hot pace in March, with both sales volume and prices of single-family homes up over a year ago. Condominium prices climbed year over year, but sales volume dropped off.

The median price of a single-family home on Oahu rose to $657,000 in March, an increase of 2.7 percent from $640,000 in March 2013, according to figures released Monday by the Honolulu Board of Realtors.

The number of sales rose 6.5 percent to 246 in March from 231 in March 2013. The median price of a condominium rose 2.9 percent in March to $350,000 from $340,000 in March 2013, but the number of sales declined 5.8 percent to 387 from 411.

“The Hawaii housing market is showing a great deal of resilience,” Julie Meier, president of the Honolulu Board of Realtors, said in a statement. She noted that single-family homes, on average, were on the market for only 17 days, compared to 22 days a year earlier. Condos were on the market an average of 25 days.

The March numbers are consistent with findings by the University of Hawaii Economic Research Organization, which predicts that the median price for a single-family home on Oahu will hit $700,000 later this year and reach $774,000 by 2015.