El Paso industrial sector lags, horizon hopeful El Paso industrial sector lags, horizon hopefulhttps://www.recenter.tamu.edu/news/newstalk-texas/?Item=65572013-08-20T13:41:00Z2013-08-20T00:00:00Z

EL PASO - El Paso’s industrial real estate market has done poorly this year, but growth is happening in Juárez and in Santa Teresa, N.M., according to CBRE.

Some companies are being lured into Santa Teresa by Union Pacific’s $400-million rail yard set to open in 2014. The rail yard is expected to lower freight costs and speed rail service.

In Juárez, CBRE recorded more leasing activity in 2nd quarter 2013 than at any point in the last five years. Overall, CBRE reported 1.2 million-sf of net absorption in Juárez’s industrial real estate market in 2Q 2013, which is the highest recorded since CBRE began keeping data.

Meanwhile, industrial real estate activity in El Paso has been negative so far this year, despite the manufacturing boom in Juárez and in Santa Teresa.

Leviton Manufacturing Company is closing its 100,000-sf El Paso plant. More than 400 people are expected to lose their jobs by the end of the year at the Westside facility. The company has laid off more than 138 people in El Paso since February 2013.

Boeing announced earlier this year it would lay off 160 workers in El Paso and close two buildings in the Northeast by the end of 2013. Hoover will shrink its workforce by 450 people, and State Farm announced plans to lay off all but 50 of its employees in the company’s Northwest Corporate Center. Most recently, Xerox announced it would lay off 490 employees at a call center in East El Paso.

The vacancy rate citywide for industrial real estate was 14.2 percent for 2Q 2013, which is historically high. Overall, the leasing rate was $19.90 per sf.

However, CBRE expects the El Paso market to rebound heading into 2014, as the surging maquiladora sector in Juárez drives up demand for warehousing on this side of the border and as more outside investors show interest in the El Paso market.

El Paso Inc.
El Paso
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