LOS ANGELES — With roughly 24 million square feet of space under construction at the end of the first quarter of 2020, Dallas-Fort Worth (DFW) leads the nation’s major markets in terms of volume of new industrial development, according to a new report from Los Angeles-based CBRE. About 19 percent of that space has been preleased.
The metroplex also led the nation in this category at the end of 2019 with 23 million square feet of space under construction, and with Texas deeming such projects as essential services, that title has remained intact amid the COVID-19 outbreak. Of the top 20 markets listed in the report, only four — Philadelphia, Oakland, Central New Jersey and Pennsylvania’s I-78/81 Corridor — have shut down industrial construction sites.
The report projected that completions of speculative projects across the country would have only a “marginal” impact on the overall industrial vacancy rate in 2020, with many of these projects having been put on hold as debt markets have faced tightening capital reserves and uncertainty on how to accurately price risk. CBRE’s report also noted that while prices for construction materials are declining, developers are also encountering delays in getting materials to sites.
Lastly, the report details various ways in which actual construction activity has changed in response to the pandemic, including the use of four-person revolving teams, the sterilization of sites between shifts and the establishment of more portable toilets and hand-washing stations.