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Since 2012, commercial real estate vacancy rates for Class A space in King of Prussia have been cut in half. Following a high of 20.4% in Q3 2012, the rate has steadily dropped to 10.4% at the end of Q2 2018. In 2012, the average leasing rate for Class A office space was at a 10-year low of $24.09/SF. In 6 years that rate has grown by 22% to $29.29/SF.
Although still unacceptably high, the vacancy rate for Class B has also seen a consistent drop to 20.6% from a 10-year high of 28.8%. Class C office space has fluctuated from the teens to the twenties after a 10-year high of 33.7%
in Q4 2011. It currently sits at 18.3%, although seemingly an anomaly since the last quarter was reported to be 11.3%. The average leasing rate for Class B and Class C is $22.75/SF and $16.20/SF, respectively.
The dramatic transformation of Class A office space in KOP has driven the aggregate vacancy rate down to 14.2% from a 10-year high of 22.3%
in Q3 2012.
The vacancy rate for industrial properties decreased from a 10-year high of 5.8% to 1.2% at the end of Q2 2018 and the average lease rate for that same period increased from a low under $6 to $8.22/SF. The vacancy rate for flex space had a more dramatic shift by 66.7% over the same period from a 10-year high of 9.4% to 3.8% with lease rates at an all-time high of $12.75/SF at the end of Q2 2018. Based on the combined inventory of both flex and industrial, with 218 properties, the vacancy rate dropped 3.3% over the 10-year period to 2.4% with an increase in average leasing rate to $11.40/SF.
Overall, the KOP commercial office market and industrial/flex market appears to be extremely healthy and we believe that this trend will continue for the remainder of 2018 and into early 2019.
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Business in the Spotlight:
A recognized leader in the global biotherapeutics industry
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In 1901, German physiologist Emil von Behring won the Nobel Prize for his discovery of a diphtheria antitoxin. His development of this serum therapy saved countless numbers of children from this fatal disease. Fast forward 117 years and von Behring's namesake company, CSL Behring, has established itself as a leader in the global biotherapeutics industry. The company's research, development and manufacturing operations in plasma-derived and recombinant products have revolutionized the treatment of rare and serious diseases, including hemophilia, immune deficiencies, respiratory disease and neurological disorders.
CSL Limited, parent company of CSL Behring, was listed by Forbes among the top 50 employers in the world based on the company's patient focus, industry innovation, sustainable practices and corporate values. CSL Limited has nearly 20,000 employees worldwide that work with the two company businesses, CSL Behring and Seqirus.
The company's US operations are based in King of Prussia and expanding into a 100,820 SF building currently under renovation at 500 N. Gulph Road. This 5-story building will allow CSL Behring's US headquarters to grow their existing 700+ person workforce in KOP and continue making dramatic advancements in treatments that benefit populations worldwide.
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In the News
Expanding Biosciences Firm CSL to Fully Occupy King of Prussia Office Building After Redevelopment
The Philadelphia Inquirer
Biosciences firm CSL Behring LLC is to become the sole occupant of 500 N. Gulph Rd., a 100,000-square-foot office property being redeveloped in King of Prussia by Brandywine Realty Trust.
Read More...
PennDOT to Construct $33M Facility in King of Prussia Ahead of Hiring Push
Philadelphia Business Journal
The Pennsylvania Department of Transportation will break ground on a new traffic management center in 2020, an approximately $33 million project that makes way for the state agency's plans to boost its headcount.
Read More...
Why This Nebraska Fintech Company Opened a New KOP Office
Technical.ly
Orion Advisor decided to go all in and establish a Philly office around CMO Kelly Waltrich. Currently at four people in a 1,500-square-foot outpost in King of Prussia, the North Wales resident will look to expand that team to 15.
Read More...
Children's Hospital of Philadelphia will Build Inpatient Facility in King of Prussia
The Reporter
When the Children's Hospital Specialty Care and Ambulatory Surgery Center opened on Goddard Boulevard in King of Prussia three years ago, it was with an eye toward inevitable future expansion.
Read More...
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Commercial Sales & Leasing Activity
SALES
SR&ZR ESTATE LLC
455 W DEKALB PIKE
$600K | 1,000 SF
ANGSON LOGISTICS ASSETS LLC
260 HANSEN ACCESS ROAD
$11.1MM | 151,298 SF
2200 RENAISSANCE BOULEVARD
14,419 SF
211 SOUTH GULPH ROAD
12,213 SF
1150 FIRST AVENUE
4,124 SF
215 CHURCH ROAD
2,044 SF
1018 W NINTH STREET
23,451 SF
1017 W NINTH STREET
4,281 SF
780 THIRD AVENUE
CAMBRIA COMPANY
60,486 SF
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PINK'S HOT DOGS
KING OF PRUSSIA MALL
481 SF
LORO PIANA
KING OF PRUSSIA MALL
CHRISTIAN LOUBOUTIN
KING OF PRUSSIA MALL
VERIZON WIRELESS
KING OF PRUSSIA TOWN CENTER
1,204 SF
Not a complete listing.
Retail leases submitted to KOP-BID for Q2 2018, as of 7.11.18.
All other sales and leasing info from CoStar.
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King of Prussia District (KOP-BID) is a 501(c)(3) not-for-profit, special
services organization. KOP-BID engages public and private partners to
collaboratively improve the economic environment in King of Prussia
by making it more vibrant, attractive and prosperous.
Learn more at visitKOP.com
DISCLAIMER: All information obtained using CoStar Analytics and field checked for accuracy by
KOP-BID. Vacancy rates are calculated using existing, non-owner occupied commercial buildings in Upper Merion Township only, over 10,000 SF, Class A, B, and C plus retail, industrial and flex.
KOP-BID uses "Direct % Vacant Available" in its vacancy rate reporting. All industrial and flex statistics are NNN.
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234 Mall Boulevard, Suite 150, King of Prussia PA 19406
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© 2018 King of Prussia District. All Rights Reserved.
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