Developers Are Scrambling To Meet Growing Demand For Warehouse Space
With manufacturing on the decline, developers are increasingly turning old industrial buildings into distribution centers to meet growing demand for warehouse space.
According to a report by Newmark Knight Frank, e-commerce is driving demand for industrial properties that can be repositioned into or demolished to make way for distribution centers.
In the past decade, the U.S. has lost roughly 640,000 manufacturing jobs, according to the Bureau of Labor Statistics. Thomas Hanna, president of Harvey Hanna & Associates, said that while “manufacturing isn’t entirely dead” his company couldn’t make the economics work to keep a former General Motors assembly plant in Delaware as a factory for luxury cars. Instead, the company will raze the plant to make way for four buildings designed for the logistics industry with additional warehouse space.
“Logistics is the fastest-growing segment within the real estate industry,” Hanna said. “Everyone is trying to figure out how to get their product to the consumer the fastest.”
Source: The Real Deal