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Now, for our prepared statement, I’ll turn it over to Denny Oklak.Denny Oklak Thank you, Ron. Good afternoon, everyone, we’re happy to have Ron on Board as VP of Investor Relations. I think many of know Ron, but Ron has 12 years of experience in the REIT sector and then we look forward to introducing him to more of you at the upcoming NAREIT meeting in Dallas. Today, I will highlight some of our key accomplishments during the quarter, in both our asset and operational strategies. Christie will then address our third quarter financial performance and progress on our capital strategy. We’ll then talk to more about our recently announced transaction. We followed up on the positive momentum we generated in the second quarter with a very successful third quarter by all accounts. We continue to improve up on all of our key operating metrics and also made progress on our asset repositioning strategy through several industrial acquisitions and our first meaningful quarter of new development starts in a while. All this positive momentum was obtained to mid continued uncertainty and mainly negative headlines from the headline News from macroeconomic prospective. Specifically, the housing market, financial services and banking sectors, and employment growth metrics continued to dominate the negative headlines. Yet manufacturing output and manufacturing surveys continue to be relatively solid. With the majority of recent job growth focused in this sector, as well as wholesale trade and transportation, demand for Duke’s bulk distribution facilities continues to be good. Fundamentals in our urban office portfolio appear to be stabilizing and medical office fundamentals continued to be strong. Development remains opportunistic with build of suites in office and industrial and relationship-driven starts in medical office. Landlords are still not commenting much if any pricing power across all product types. Even with these challenging economic issues on international basis, I’m very pleased with the progress we made this quarter across our entire portfolio.
The total portfolio occupancy increased to 90.7%, which is our highest levels since 2000. We renewed 69% of our leases during the quarter and attend an overall rental rate growth on these renewals of 1%. The new lease activity totaled 3.2 million square feet and when you couple this with a low level of terminations, we generate a positive net absorption of over 1. 6 million square feet.While rent spreads are still challenging, it’s pleasing to see that we had a positive releasing spread across all product types. We also achieved positive same property net operating income growth for this 3 and 12 months ended September 30 of 1.2% and 2.1% respectively. Once again, all product types produce positive results. Now, let me touch on some of the key activity within each product side for the quarter. Industrial activity was strong across most of our markets. We completed over 1.9 million square feet of new industrial leases and approximately 1.9 million square feet of industrial renewals. This leasing activity increased our overall industrial occupancy to 92.4% at September 30. Some of our larger deals included a 446,000 square feet lease in national to a major Internet retailer, to take that building to 100% occupancy, a167, 000 square feet at lease in Phoenix to cosmo power, filling up our value add acquisition from earlier this year and a 158,000 square foot 20-year lease in Dallas to Genuine Auto Parts. In all, I’m very pleased to report that over half of our industrial markets have occupancy levels above 94%. I would point out that we have a few large fourth quarter lease expirations where the tenants have notified us they are not going to renew, so we anticipate some drop in our industrial occupancy level at year-end. The office leasing environment continues to be challenging as expected. However, we were able to increase our office occupancy by over 50 basis points to 85.93% and achieved positive rent growth on renewals of 1.4%.
Some of our larger new office leases included in 82,000 square foot lease in Chicago to a major insurance company and 69,000 square foot leases in Atlanta to Rockton Company, square feet of leases in Indianapolis to Interactive Intelligence and a 46,000 square foot lease in South Florida to the University of Miami.Read the rest of this transcript for free on seekingalpha.com