Archives

, , , , , , , , Posted by on

Amid Shifting Winds, Industrial Stands Strong In Core Markets

The economic shores are starting to get frothy, with incoming waves like Chinese tariffs and a downturn market threatening to crash on the beach.

Despite this, the 2020 outlook for U.S. industrial real estate remains positive as low vacancy rates and rising rents offer a calming breeze.

Continue reading

, , , , , , , , , Posted by on

Blackstone Buys Industrial Portfolio Near Miami Airport for $56M

Blackstone bought a huge industrial portfolio next to Miami International Airport for $56 million.

The private equity giant bought the three warehouses totaling 367,848 square feet at 3208 Northwest 72nd Avenue and 3108 Northwest 72nd Avenue for $152 per square foot, records show. Airport Trade Center, which lists Haim Yehezkel as one of its principals, is the seller. Yehezkel leads the real estate firm Elysee Investments in Miami Beach. The warehouses were built in 1972 and last traded for $13 million in 1999.
Continue reading

, , , , Posted by on

Report: After Strong Growth, Industrial Development Slowing Slightly Nationwide

The number of industrial buildings coming online nationally slowed slightly in the first nine months of 2018, after several years of strong growth.

A total of 237 million square feet of new industrial space was delivered across the country from January through September, down slightly from 243 million square feet year over year, according to a new report by Avison Young.

The slowdown follows a major growth period for industrial development across the country, with 1.5 billion square feet of new space coming online since 2012, the report said.

“The surge in deliveries in previous years left many markets struggling to absorb the new space, and developers unwilling to start new projects,” Avison Young principal Erik Foster said. “As the existing space is filled, new projects will start getting launched.”

Markets like Los Angeles and Chicago have been leading the way in industrial market growth, and developers have benefited from record low vacancy rates and strong rent growths. But after years of growth, even those markets slowed this year.

Chicago saw 10 million square feet of new industrial space in the first three quarters of 2018 — a steep drop from the 22.6 million year over year, according to Avison Young. Los Angeles saw 5.4 million square feet of new industrial space through three quarters, which is about 77 percent of the way to its 2017 total of 7 million square feet.

In Chicago, the drop in deliveries caused vacancy rates to continue falling, with the 5.7 percent vacancy in the third quarter a 20 basis point drop year-over-year. That’s not the case in Los Angeles, where vacancy in the Inland Empire area increased to 4.9 percent but is still near record lows.

While deliveries are down so far in 2018, they won’t be for long: More than 337 million square feet of new industrial space is under construction across the country, the report said.

New Jersey has already eclipsed its 2017 industrial delivery total, with 10.3 million square feet of new space coming online through three quarters of this year, compared with 9.7 million square feet delivered all last year.

In Miami, demand for warehouse space has pushed vacancy rates to a record low 2.7 percent in the third quarter, falling 33 basis points year-over-year. But more than 4 million square feet of industrial space under construction will increase the supply.

“Secondary markets across the country are now benefiting from the same economic factors that caused a surge of industrial development in larger markets,” Foster said.

Growth in e-commerce is leading companies to increase the amount of industrial space needed for productive storage and delivery. Columbus, Ohio, for example, has seen 4.3 million square feet of industrial deliveries so far this year, eclipsing 2017’s year-end total of 3 million new square feet. In Greenville, South Carolina, 2.8 million square feet has been delivered through the end of the third quarter, eclipsing 2017’s total of 2.3 million square feet of new development.

 

Source: The Real Deal