Charleston is one of the fastest growing industrial markets on the east coast with a strategic location within an 11-hour drive of 28 percent of the U.S. population. The Port of Charleston’s expansion will be a driving factor in the growth of the industrial market in additional to a new container terminal being built that is connected directly to I-26 and dual rail services that are expected to be open by 2021. The deepening of the Port of Charleston harbor is a major contributor to the growth in industrial activity in the region. The new and existing terminals will benefit from a 52-foot shipping channel which will permit post-Panamax ships to use the harbor regardless of the tide.
The Charleston industrial market has many key strengths.
The Charleston industrial market totals 54 million square feet with another 3.1 million square feet currently under construction. Logistic providers, automotive and aeronautical suppliers are expanding into the market because of the Port of Charleston and a fast-growing population. Over 800 thousand people live within 50 miles of Charleston, with an expected growth of 9 percent within five years. There are over 21 million people living within 250 miles of the Charleston region with an expected growth of 5 percent within five years.
The Charleston industrial market is a logistics driver.
The Charleston industrial market benefits from an efficient logistics system and offers transportation from both the ground and air in addition to the Port of Charleston. The port with its inland counterparts, generates $53 billion in annual economic activity. The Inland Port Greer is rapidly transforming the I-85 corridor with its central location between Charlotte and Atlanta. The inland port is located within a circumference of 94 million consumers within 500 miles which extends the Port of Charleston’s intermodal reach by 212 miles.
Charleston economic market indicators are strong.
Charleston is one of the best performing industrial markets in the nation with a decade high 3.3 million square feet of net absorption, one third of which is in the Summerville submarket. In the past four years the overall net absorption exceeded 2 million square feet and Charleston posted an overall absorption rate of 6.1 percent, the 5th highest in the nation.
Developers remain bullish on the market and continue to build new industrial buildings despite higher vacancy rates in the Charleston market of 9 percent. Demand for premier industrial space remains high near a major seaport. There was a record 2.8 million square feet of construction completed in 2018 with an expected 3.1 million more industrial space to be built in 2019. Asking rents remain high at $4.95 per square foot in Charleston.
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