The Charlotte industrial market has continued to weather the global economic storm with relative stability. Experts in the market believe this is by design and is not just good fortune. A disciplined development community that did not over-build the city is the foundation for the stability. The market size for institutional grade industrial product in Charlotte is approximately 30 million square feet. The entire market is well more than 100 million square feet, which comprises user-occupied and manufacturing product that institutional investors are not trading day-to-day. With 3.3 million square feet available, the institutional market stands at 11 percent vacant. Given the gloomy economic news that we have all grown accustomed to hearing, an 11 percent vacancy rate is not particularly unhealthy. The key statistic is this: in a 30 million-square-foot market, only 250,000 square feet is being constructed, representing less than 1 percent of the market. In addition, only 1.7 million square feet of product is in the planning stages, with no assurances that it will go vertical in the near future. If all 1.7 million square feet of product were to be built — which won’t happen — it would represent a 5.7 percent increase in inventory. There …
Industrial
As we continue to track changes and trends in the industrial sector on Long Island, two things remain constant: Go East and Go Up. The east offers land availability and height is playing a more significant role than ever in space utilization. It’s always been about cost effectiveness. When land was plentiful and less costly, it was more economical to build out, rather than up. With the shortage of land, the price has escalated such that, to achieve the same cubic feet of space, it is necessary to build or raise the ceiling heights for better economic functionality. This, coupled with better material handling equipment, makes it practical and necessary to accommodate growth and maintain profitability. A prime example of this is the pending sale of the Stimpson Company property in Bayport — a low-ceiling, 200,000-square-foot building set on 22 acres. An old line regional company is buying this property because it has an oversized plot, and while they were planning to raise the ceiling from 15 to 40 feet clear, plans were only recently abated as a result of the current economic environment. As mentioned, the towns of Islip and Brookhaven have been aggressively seeking industrial growth through their …
What area is your expertise? I specialize in the sale and lease of industrial buildings and land in the Denver Metropolitan area. What trends do you see presently in industrial development in your area? Speculative construction is still ongoing in the industrial sector. The demand for functional office/warehouse, distribution and condominium warehouse buildings remains stable which has prompted several local and national developers to bring new product to the market this year. YTD deliveries and anticipated third quarter completion of speculative construction include: East I-7-/Montbello industrial submarket Whirlpool Building — 410,000 square feet (Panattoni Development Co.) Mile High Business Center — with a 337,000-square-foot building and a 90,000-square-foot building (Panattoni Development Co.) Airways Business Center — with an 83,225-square-foot building, a 79,650-square-foot building and a 57,630-square-foot building Majestic Commerce Center — with a 215,000-square-foot building (Majestic Realty Co.) Enterprise Park at Stapleton — with a 153,035-square-foot, a 148,90-square-foot, and 139,695-square-foot building (Etkin Johnson) Northeast industrial submarket OmniCenter — with two 38,240-square-foot buildings (Landmark Properties Group) Southeast industrial submarket Compark Commerce Center — with a 62,000-square-foot building (Urban Construction, Inc.) Corporate Park at Stonegate — with a 44,700-square-foot and a 37,580-square-foot building (Ascendant Development) Twenty Mile Commerce Center — with a …
What area is your expertise? Our team’s expertise is the industrial real estate market primarily in Western Washington along the Interstate 5 corridor. We also work nationally for clients who are expanding into other areas either for site/space acquisitions or investment opportunities. What trends do you see presently in industrial development in your area? Currently there is no speculative development occurring in our area. Sites of interest would be infill sites in mature markets and rail-served sites. Risk is being priced back into the market with a significant pricing spread being evident between Class A and Class B properties — something we did not see during the high point of this past real state cycle. What type of industrial product is doing well in your area? Business parks accommodating the smaller to medium size users are doing relatively well. In addition, properties located near or in Seattle are doing well. The Kent Valley, due to its close proximity to Seattle and being composed or primarily business parks, is experiencing a decline in vacancy rates. In addition, rail served sites are a desirable commodity. Who are the active industrial developers in your area? Active national developers include: Panattoni, First Industrial, Opus, …
What area is your expertise? Industrial leasing and sales in the Northern Nevada area, including Reno, Sparks, Fernley, and Carson City. What trends do you see presently in industrial development in your area? Abatement of planned buildings while developers wait for speculative big-box construction to absorb. What type of industrial product is doing well in your area? Industrial condos have seen an increase in sales due to some aggressive owners acknowledge current market conditions and dropping prices. Concerning leasing, the 20,000 to 40,000-square-foot sector has been relatively active in big-box industrial spaces. Who are the active industrial developers in your area? Prologis, Panattoni, DP Partners, McShane, Tarragon, UPC, and Development Arts. Please name one or two significant industrial developments in your area. What impact will these projects have on the market? The addition of several new developers building speculative big-box construction has created a new dynamic in the Northern Nevada industrial market. The short-term impact has created a significant increase in overall vacancy. The long-term outcome remains to be seen, but optimistically may create healthy competition among developers luring new prospects to Northern Nevada. The disposition of the Panattoni Industrial Portfolio, a 2.02 million-square-foot portfolio consisting of seven buildings in …
What area is your expertise? Salt Lake Valley, Utah What trends do you see presently in industrial development in your area? Large flex office, warehouse and light industrial centers are planned for the northwest quadrant of the Salt Lake Valley near the new Pacific Railroad’s Salt Lake City Intermodal hub at Highway 201 and Bangerter Highway. What type of industrial product is doing well in your area? With vacancy less than 5 percent, all industrial products are doing will. First generation product landlords will continue to push for increasing rates of $.55+ psf/mo/nnn (warehouse) and $1.00+ psf/mo/nnn (office). Second generation industrial buildings remain occupied with some softening of lease rates. Who are the active industrial developers in your area? Argent Group, Roderick Enterprises, and Rockefeller Group Development Co, Please name one or two significant industrial developments in your area. What impact will these projects have on the market? Two developments are planned to be constructed at Bangerter Highway and Highway 201. When completed, The Commerce Center, developed by The Argent Group, will add 1.8 million square rentable square feet. The Rockefeller Group will increase available space by 930,000 rentable square feet. Where is the majority of development taking place? Why …
What area is your expertise? For the purposes of this report we are discussing the Industrial Market in Akron, Ohio and the five counties surrounding it (Summit, Stark, Wayne, Portage and Medina counties). What trends do you see presently in industrial development in your area? We are in a stable market with softness in the industrial sector, primarily due to the credit crisis and overall skepticism in the marketplace beginning in 2008 to present. The greater Akron marketplace is made up of many older industrial buildings that were built by the rubber companies and other industrial giants such as the Hoover Company located in North Canton. Local and regional rehab developers have come into the marketplace and purchased these million-square-foot facilities and rehabbed them into multitenant, mixed-use type facilities. The attractiveness of these facilities is generally low-lease rates and the infrastructure that is already in place, making total occupancy cost lower than new construction. What type of industrial product is doing well in your area? Smaller industrial, newer buildings with land for expansion available on a purchase basis as a second or third opportunity from an ownership basis. Who are the active industrial developers in your area? Richfield, Ohio-based Realty …
What area is your expertise? Industrial property in the Kansas City metropolitan area. What trends do you see presently in industrial development in your area? The emergence of large, big-box distribution centers (greater than 250,000 square feet) as well as the emergence of inland ports, which are logistic parks in close proximity to intermodal centers. Kansas City has traditionally been a market for users of smaller blocks of space, but this has changed over the past 5 years. Transactions greater than 250,000 square feet new to our market include companies such as Case New Holland, Pac Son, Kimberly Clark, and Musician’s Friend. Additionally, large industrial logistics parks are planned for the property adjacent to a new intermodal facility, which has opened in Southern Kansas City at M-150 and 71 Highway at the old Richards-Gebaur Airport, which is operated by Kansas City Southern Railroad. CenterPoint is the developer of this park. Additionally, other intermodal projects are underway in both Gardner, Kansas, and at the Kansas City Airport. What type of industrial product is doing well in your area? Class A distribution space greater than 50,000 square feet. Who are the active industrial developers in your area? Multiple local developers Please name …
What area is your expertise? Mid-Michigan, primarily the greater Lansing area. What trends do you see presently in industrial development in your area? Very soft. Some activity from small businesses and companies doing defense work for U.S. government. What type of industrial product is doing well in your area? 10,000 square feet and smaller Who are the active industrial developers in your area? Wieland-Davco and Dart Where is the majority of development taking place? Why is this area doing well? Delta Township due to the newer General Motors plant. What area do you expect to be the next big industrial development market? Why? Expansion of newer Delta Plant. If present car models sell well, they have plans to expand. Please describe the industrial leasing activity in your area. Some smaller and short-term leases. Please describe the industrial sales activity in your area. Very little and what there is, are prices below market. What impact do current interest rates have on the industrial market? What predictions do you have for interest rates and their effect on the industrial market in the next year? Lower interest rates help, but that alone will not be enough. What industries do you expect to expand …
What area is your expertise? Chicago Metropolitan Market What trends do you see presently in industrial development in your area? 1). A slowing in closing of sales and execution of leases. 2). A 1.3 percent rise in vacancy rates. Our Midway and South Cook County markets, however, have experienced the highest vacancy rates at 12.3 and 11.1 respectively. 3). Quarterly absorption in fourth quarter 2007 was a positive of 3.5 million square feet to first quarter 2008, which was a negative absorption of 2.5 million square feet. 4). Leasing activity has dipped 10 percent from same time last year. 5). Average sales prices have increased for Industrial product from $59.48 square feet fourth quarter 2007 to $61.81 first quarter 2008 even though sales during those two periods have dropped from 3,750,000 square feet to 3,250,000 square feet (first quarter 2008). Approximately 12 million square feet of projects are under construction at this time and much of the space has yet to lease to the first tenants. What type of industrial product is doing well in your area? Across the board: From 20,000 square feet to 1 million square feet, with a more rapid conclusion to sales and leases on the …