Q3 2020 Omaha Industrial Market Report
Omaha is a natural distribution hub due to its central location, strong agriculture industry, and ability to transport via rail, road, river and air. As a result, fundamentals have been sturdy traditionally, and vacancies remained compressed below 5% through mid-2020. This has not only kept national tenants like Kellogg and Tyson Foods in the metro, but it will also bring Facebook when its data center completes in 2022. Through positive demand returned late last year and demand for logistics space has only increased as more people order groceries and goods online in the wake of the coronavirus, the pace of asking rent gains has declined. Year-over-year average asking rent growth decelerated following rent losses year-to-date through mid-2020 and put a nick gains made across 2019. Developers have yet to slow down as nearly 635,000 SF was under construction in 20Q3. With roughly 85% of the space preleased, the added space is unlikely to weaken occupancies. Following a peak in sales volume $190 million in 2019, investment has since declined as investors and lenders became wary of deals amid uncertain economic times.