Warehouse Supply Trends
When it comes to lucrative real estate properties, warehouses might not be the first things that come to mind. Over the last few years, a number of factors have combined to make warehouses a hot commodity in the business world.
Demand for Warehouse Space Continues to Grow
According to real estate company CBRE, during the second quarter of 2017 the warehouse availability rate dropped to 7.8 percent, marking the lowest level since the first quarter of 2001 and the 27th decline over the last 28 quarters.
Not surprisingly, the scarcity of warehouse space has driven a corresponding increase in rental rates. Average rates are up 10 percent in the top coastal markets and average asking prices are $5.25 per square foot, a significant jump from $4.62 per square foot two years ago.
Construction Is Slow to Meet the Increased Need for Warehouses
While existing warehouse space is in high demand, new construction has so far failed to pick up the slack. Projections called for a total of 46.5 million square feet in new warehouse space to be completed during the second quarter, but the actual total amounted to 40.2 million square feet.
Jeff Havsy, CBRE’s chief economist in the Americas, attributes the tight warehouse market to strong economic growth. Other causes include gains in port traffic and the continued upswing in e-commerce.
Industrial Tugs for All Jobs Big and Small
No matter what size your warehouse is, electric industrial tugs from DJ Products let your employees move heavy loads quickly and safely. Visit our website and use our handy online chat feature to learn more from our knowledgeable sales engineers.