Industrial real estate near airports in the nation’s most densely populated areas could be attractive investments for 2023.
With transportation accounting for up to 70% of overall supply chain costs, businesses are increasingly locating their distribution centers closer to airports, according to CBRE Supply Chain Advisory.
The industrial sector remained one of the strongest commercial real estate performers in 2022, despite rising interest rates and ballooning inflation.
Onshoring efforts, coupled with a continuation of last year’s e-commerce boom, have only added to the already sky-high demand for industrial real estate. But in the second half of 2022, the industrial market began to show signs of tempering fundamentals.
Industrial developer Jose Hernandez-Solaun of The Easton Group has seen Amazon spur the rise of e-commerce over the last few years. But now, he sees the coronavirus pandemic rapidly ramping up that growth — putting it on steroids.
“What we are finding now is the coronavirus effect,” said Hernandez-Solaun. “If the Amazon effect was strength training, this was what you get on performance-enhancing drugs.”
Hernandez-Solaun and other South Florida industrial brokers and developers say the sector could benefit in the long-term from many of the behavioral changes spurred by the crisis. Consumers, increasingly from older generations, will shift more of their spending to e-commerce. More manufacturers will come to the Americas from China. And after experiencing inventory shortages, more warehouses will be needed, experts say.