The City of Indianapolis contains approximately 843,393 residents and is the 12th largest city in the country. The economy is broad based largely consisting of education, health services, trade, transportation, utilities, regional government and professional and business services. The Education and Health Services sector plays a major role within the economy, employing approximately 127,000 people. St. Vincent Hospital, the largest employer in Indianapolis employs approximately 10,000 people. In addition, a well-developed commercial freight distribution network plays an integral role in Indianapolis’s economy. It links Indianapolis to the regional and global economy through railways, interconnected freeways and highways, and the Indianapolis International Airport.
Economic Overview
Indianapolis is recovering steadily as a wide swath of private industries contributes to employment growth. After a nice recovery, job growth in Indianapolis has slowed drastically. Nonetheless, the unemployment rate is falling despite upward pressure from an expanding labor force and at 5.2% is below both the state and national rates.
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Vacancy rates in the market have declined 40 basis points since the 4Q 2013 to 9.7% as of the 4Q 2014. The Indianapolis Class A Office market has had limited development activity over the last couple years, however tightening market fundamentals have attracted developers back to the market. There are a few larger projects to be delivered in 2016 which consist of build to suit properties for owners and pre-leased projects. Indianapolis's office vacancy rates are as low as they have been in the last 10 years, and contiguous blocks of space are hard to find in downtown with minimal availability of spaces larger than 50,000 SF. Due to a lack of near-term supply, vacancies are expected to continue their compression for at least the next 12