LVEDC Identifies Notable Commercial Real Estate Transactions in 2021’s Final Quarter
By Nicole Radzievich Mertz on February 21, 2022
In lieu of a Q4 Commercial Real Estate report, the Lehigh Valley Economic Development Corporation (LVEDC) has compiled an update of notable real estate transactions for the final three months of 2021, a quarter marked by continued strong performance from the industrial market.
A recap of the market in 2021 will be published in the LVEDC’s Annual Report, which will be issued in March.
In the fourth quarter, the Lehigh Valley continued to grow its industrial footprint, with more than 5 million square feet under construction at the end of the year, even as vacancy rates plummeted and rent grew.
The quarter ended with a vacancy rate in industrial and flex space inventory at 4.1%, down from an already low 4.9% the year before. Meanwhile, rent rose at a historic rate to $7.71 a square foot, a 16.8% jump in a year, according to CoStar, a leading source of real estate analytics.
The office market was cool as back-to-the-office plans began and then stalled while health concerns heightened amid the surge of the Omicron Variant. During the fourth quarter, 15,000 more square feet of all office space was vacated than filled, pushing the 2021 net absorption down to -234,000 square feet. Rent for office space, excluding owner-occupied and medical offices, stagnated at $16.09 a square foot, according to CoStar.
The 763,300 square feet of office construction was driven by Air Products’ new campus in Upper Macungie Township and an office building at The Waterfront project in Allentown.
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