How Real Estate Firms Are Helping Retailers Find Warehouses Closer to Customers

Industrial property traditionally has been one of the less attractive commercial real estate sectors, but that is rapidly changing. International trade expansion and hefty e-commerce growth have led to increased demand for industrial space as companies try to accommodate large volumes of inventory and position themselves for efficient product delivery. Whether they’re looking for warehouse space or distribution centers, industrial real estate is a hot commodity that investors are scrambling to own or rent.

“Industrial tended not to attract as much notice before because, in fairness, it’s a lot easier to talk about a very attractive glass office building than to talk about an industrial warehouse,” explained George Ratiu, managing director of housing and commercial research at the National Association of Realtors.

But the landscape has changed. The expansion of the Panama Canal has strengthened the appeal of East Coast ports as distribution centers for Asian markets, driving competition with Long Beach, Calif. Meanwhile, the “Amazon effect” has increased the value of industrial properties in urban centers, as they can provide shortened delivery times that customers have come to expect. And despite the high volume of need for industrial space, many companies are unwilling to tie up their financial assets in real estate and would prefer to lease so that they can free up capital for expanding their business.

“A lot of investors who traditionally would not have considered industrial are actually paying much closer attention now,” said Ratiu.

In order to best serve this new crop of investors, real estate firms are creating their own resources to help parties navigate the sector. This week, CBRE launched its Americas Industrial & Logistics Occupier Guide, accompanied by an interactive map that illustrates data for markets across North and South America. Information ranges from average rents and available square footage, to regional tax costs and local infrastructure.

“Today’s occupiers of industrial real estate must have access to deep, sortable data to practice intelligent site selection, and they need it as early in their process as possible,” Adam Mullen, leader of CBRE’s Americas industrial & logistics business, said in a release.

Meeting a different need, Cushman & Wakefield has recently launched an interactive industrial construction map that tracks square footage still under construction across the U.S. as well as year-to-date deliveries and absorption. Due to the sudden uptick in demand for primely positioned warehouse space, there is an issue of supply. To navigate this, the map displays where upcoming availability will be found.

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