Some days this feels like the best of times for those who operate logistics companies and who operate industrial real estate, but the worst of times for those looking for a bargain on warehouse space. There has been significant economic growth, and the U.S. industrial market continues to expand. Nationwide, warehouse vacancy decreased to 4.3% in the first quarter of 2019. This is near the lowest this number has been since this data began to be tracked in 1980. In certain markets, it is even lower, sometimes just a few properties. Moreover, the Class A and B space was the first to be absorbed; much of what is currently available is Class C and D, and these are mostly 50-year obsolete properties and shuttered manufacturing plants. In response to this trend, new warehouse construction is going through the roof, with 258 million square feet in new space under construction, the majority of which are speculative buildings. However, this supply of new warehouses is still less than current demand. Are you challenged to find high quality warehouse space and service providers where and when you need them? Spartan Logistics has been planning for this day for 30 years.
Diminishing Warehouse space,
NAI Harmon Group