Baltimore Office Market
The fourth quarter of 2016 saw a significant rise in office space deliveries in Baltimore, notably the completion of energy provider Exelon's 477,366-square-foot regional headquarters in the Harbor East submarket. In total, 1.1 million square feet of new space delivered within the Baltimore area during the fourth quarter alone. This uptick in deliveries led to an increase in the overall vacancy rate to 12.8%, up from 12.0% at the end of the third quarter. However, this rate is lower than the 12.9% observed for the fourth quarter of 2015, and down significantly from the cyclical peak of 15.8% at the start of 2012.
Baltimore Industrial Market
Baltimore's industrial market finished 2016 on a strong note, with positive absorption in the fourth quarter and a robust absorption total for the year. Vacancy declined during 2016, as deliveries were limited relative to the size of the market. On balance, conditions tightened during 2016 and the market is poised for further tightening in 2017, even though the construction pipeline has expanded.