Industrial land projects won’t ease vacancy rate

Industrial land development projects totalling nearly 300,000 square feet are under construction in the Regina area, helping to raise the industrial vacancy rate from less than two per cent in the first half of 2014 to 2.75 per cent in the third quarter, according to Colliers International.

But it might be a couple of years before vacancy rates for industrial property get much above three per cent in Regina, an industrial real estate specialist with Colliers said.

“New land development is taking place in several areas around Regina, including in the Ross Industrial Park, the Global Transportation Hub (GTH), Parker Industrial Park (north of Regina), Carson Business Park and Great Plains Industrial Park (near White City), among others,’’ states Colliers’ Regina industrial market report.

“Phase III of Ross Industrial Park is the primary hub for new city construction and currently there is approximately 100,000 square feet under construction. Combined with other projects in the city and the GTH, there (are) currently 290,000 square feet currently under construction.”

Demand for industrial properties has been steady throughout 2014 and the vacancy rate remains low at 2.75 per cent. In the second and third quarters, just under 30,000 square feet were absorbed by the market, for a total of 162,000 square feet for the year to date.

“The GTH continues to play a significant role in the industrial market where land is fully serviced, but is priced less than half of comparable land in the city’s other industrial areas. It is expected that more private development will be announced at the GTH in the near future and that development will begin especially in the commercial services sector in the northeast corner of the development,’’ the report said.

Paul Mehlsen, managing partner with Colliers, said Regina had a shortage of industrial land, although development of 70 acres of industrial land in Ross Industrial Park, as well as at the GTH west of Regina, will ease the space shortage. Melcor Development’s Fleet Street Business Park will provide additional land for industrial tenants that want to be in the city, while Morguard’s TransLink Logistics Centre has space available at the GTH.