Terry Coyne

. Due to the city’s large presence in the office and industrial submarkets, it is therefore worth investigating what trends are developing in Independence.

Independence’s industrial market is performing remarkably well, with a vacancy rate of 5.0%. The city’s industrial property has performed well for the past year, but the vacancy rate of 5.0% is the lowest vacancy rate in the past several years. Easy access to I-77 and I-480, and its location in the center of the Cleveland suburbs, make Independence a good location for manufacturers, distributors, and businesses with clients located across Northeast Ohio. Additionally, Independence has one of the lowest property tax rates in the Cleveland area. Locating in Independence from a higher tax city brings down the cost of property for many companies, making it an attractive location.


The industrial buildings in Independence average 46 years old, with an average size of 44,300 square feet. Rents have dropped about 15% over the past several years, with an average asking rent of $4.74/SF. The decline in asking rent appears to have leveled off in recent quarters. Asking sales prices are still declining, having dropped 33% since 2007. The average asking sales price is now just over $24 per square foot. Given the industrial market’s strong performance, it seems likely that rents and sales prices will stabilize in the coming quarters. Investors may even see Independence as a candidate for investment, given the lower sales prices.
Independence’s office properties make up a large majority of the South submarket. Since it makes up almost 73% of the submarket (and almost 9% of all Cleveland’s office space), Independence’s performance plays a large role in determining the vacancy rate and net absorption of the market. The first quarter was a good one for Independence, as over 55,000 SF of office space was absorbed. This brought the vacancy rate down almost 160 basis points. This drop to a 20.3% vacancy rate means that Independence is performing better than the rest of the South submarket (22.5%) and the overall Cleveland market (20.4%).


In a departure from the norm, Independence’s class B properties have a lower vacancy rate than its class A properties – 14.5% and 23.4%, respectively. This is likely due to tenants downgrading their space, moving to cheaper class B space during the recession. This trend does appear to be reversing – the vast majority of net absorption in the first quarter occurred in class A space. This trend will need to continue for several quarters in order to normalize the Independence market. Currently, Class A rents are averaging $21.56/SF, while Class B asking rents average $18.01/SF.
Independence’s office property will likely continue its recent success. The average building age is 26.5 years old, and approximately 60% of the market is Class A space, which will come into greater demand as the market continues to improve. Asking sale prices have declined 10% since 2007, and are now around $82 per square foot. Recent sales of high vacancy properties averaged $58/SF, but any investment sale of a building that is mostly occupied would likely draw a much higher price. Independence’s low property tax rates also help encourage companies and investors to look at the city for real estate opportunities.
Independence’s location makes it an ideal place for industrial and commercial property alike, as it is situated on several highways in the center of the Cleveland market. This location will continue to bring vacancy rates down as the market continues to strengthen. The city’s low tax rates also offer incentives. As companies find their budgets growing, they will begin to look at upgrading their office space or expanding. Independence will continue to play a large role in the suburban office market recovery through 2012.

Stay up to date on Northeast Ohio’s commercial real estate market by joining Terry Coyne for a Mid-Year Forecast Webinar on May 15 at 10:00 am (EST). Space is limited, so sign up now to reserve your spot!

. Due to the city’s large presence in the office and industrial submarkets, it is therefore worth investigating what trends are developing in Independence.

Independence’s industrial market is performing remarkably well, with a vacancy rate of 5.0%. The city’s industrial property has performed well for the past year, but the vacancy rate of 5.0% is the lowest vacancy rate in the past several years. Easy access to I-77 and I-480, and its location in the center of the Cleveland suburbs, make Independence a good location for manufacturers, distributors, and businesses with clients located across Northeast Ohio. Additionally, Independence has one of the lowest property tax rates in the Cleveland area. Locating in Independence from a higher tax city brings down the cost of property for many companies, making it an attractive location.


The industrial buildings in Independence average 46 years old, with an average size of 44,300 square feet. Rents have dropped about 15% over the past several years, with an average asking rent of $4.74/SF. The decline in asking rent appears to have leveled off in recent quarters. Asking sales prices are still declining, having dropped 33% since 2007. The average asking sales price is now just over $24 per square foot. Given the industrial market’s strong performance, it seems likely that rents and sales prices will stabilize in the coming quarters. Investors may even see Independence as a candidate for investment, given the lower sales prices.
Independence’s office properties make up a large majority of the South submarket. Since it makes up almost 73% of the submarket (and almost 9% of all Cleveland’s office space), Independence’s performance plays a large role in determining the vacancy rate and net absorption of the market. The first quarter was a good one for Independence, as over 55,000 SF of office space was absorbed. This brought the vacancy rate down almost 160 basis points. This drop to a 20.3% vacancy rate means that Independence is performing better than the rest of the South submarket (22.5%) and the overall Cleveland market (20.4%).


In a departure from the norm, Independence’s class B properties have a lower vacancy rate than its class A properties – 14.5% and 23.4%, respectively. This is likely due to tenants downgrading their space, moving to cheaper class B space during the recession. This trend does appear to be reversing – the vast majority of net absorption in the first quarter occurred in class A space. This trend will need to continue for several quarters in order to normalize the Independence market. Currently, Class A rents are averaging $21.56/SF, while Class B asking rents average $18.01/SF.
Independence’s office property will likely continue its recent success. The average building age is 26.5 years old, and approximately 60% of the market is Class A space, which will come into greater demand as the market continues to improve. Asking sale prices have declined 10% since 2007, and are now around $82 per square foot. Recent sales of high vacancy properties averaged $58/SF, but any investment sale of a building that is mostly occupied would likely draw a much higher price. Independence’s low property tax rates also help encourage companies and investors to look at the city for real estate opportunities.
Independence’s location makes it an ideal place for industrial and commercial property alike, as it is situated on several highways in the center of the Cleveland market. This location will continue to bring vacancy rates down as the market continues to strengthen. The city’s low tax rates also offer incentives. As companies find their budgets growing, they will begin to look at upgrading their office space or expanding. Independence will continue to play a large role in the suburban office market recovery through 2012.

Stay up to date on Northeast Ohio’s commercial real estate market by joining Terry Coyne for a Mid-Year Forecast Webinar on May 15 at 10:00 am (EST). Space is limited, so sign up now to reserve your spot!