The Industrial Real Estate Market Dominance Continues has been on the rise since 2013 and continues to grow as more businesses flock to the efficiency of industrial real estate space.
This article provides a breakdown of the major industries that are making this possible, how this is impacting industrial real estate owners, and how real estate developers are moving away from their traditional model in order to accommodate the needs of this growing industry.
The industrial real estate industry is composed of a diverse group of companies and individuals, ranging from master developers to small businesses providing contract services. Read more
Industrial real estate buyers are typically construction firms that need space for their manufacturing facilities, warehouses, distribution centers, and other industrial locations.
The market for industrial real estate is rapidly growing due to the expansion of the manufacturing sector in the United States.
This sector is projected to grow by 6% annually over the next 10 years, which will generate an additional $40 billion in capital investment.
Not only are manufacturers investing in new manufacturing facilities, but they also must add facilities as they continue to increase production levels.
Interesting Facts about Industrial Real Estate Investment:
Industrial real estate continues to dominate the market, with companies such as CBRE and JLL continuing to thrive.
According to CBRE, the industrial market is forecasted to grow at a rate of 6.7% over the next five years. Numerous factors, such as increasing international trade and greater infrastructure spending, are credited with this expansion.
JLL has also seen positive growth in the industrial market. In 2017, the company generated $4.4 billion in revenue from industrial properties. This represents a 6% increase over 2016.
The continued success of these companies suggests that industrial real estate remains a stable and lucrative investment option. 3. Businesses Moving to the South
The Industrial Real Estate Market Right now
One of the major trends impacting industrial real estate is an increase in business moving to the south. According to a report from Colliers International, 49% of industrial markets are located in the South.
These regions have seen an increase in business demand due to their close proximity to ports, highways, and airports as well as their lower costs.
This demand has resulted in over $60 billion worth of investment within these markets over the past five years. However, unlike most sectors of real estate, there is a strong correlation between business activity and growth rates for industrial properties.
The increased demand for industrial space has led to high occupancy rates and stable leasing throughout many of these markets. Companies that are seeking more
How Did Industrial Real Estate Become so Popular? Right now
One of the most well-liked investment possibilities for both individuals and companies is industrial real estate.
This is because industrial properties typically offer a high return on investment (ROI) and are often in desirable locations. Additionally, industrial properties are often immune to economic downturns, making them a stable investment choice.
The fact that industrial real estate is a flexible investment is one of the key reasons it has grown to be so well-liked.
Industrial properties can be used for a range of activities, including production, distribution, and R&D. Because of the constant need for industrial real estate, a significant return on investment is possible.
Another reason why industrial real estate is popular is that it is an easy way to diversify your portfolio.
Industrial properties are not as volatile as other types of investments, so they are a good option for those who want to stick to a conservative investment strategy.
Moreover, industrial properties tend to have long-term potential, making them ideal for retirement accounts and other long-term savings goals.
Overall, industrial real estate continues to be one of the most popular options for investors and businesses alike. This is a result of its strong return on investment and adaptability
What Advantages Do Industrial Properties Offer?
Industrial real estate is a great investment for both the long and short term. Here are a few of its advantages:
1. It is an investment that is safe and secure. Industrial real estate is not as volatile as other investments, so it provides stability in your portfolio.
2. It has high yields. Industrial real estate can offer high returns because it is often near major transportation hubs and businesses. This means that it is frequented by people and companies, which leads to high rents and fees.
3. It offers tax advantages. Because industrial properties are typically used for business purposes, they are considered commercial property, which means that they are taxed at a lower rate than residential properties. This can result in big savings on your taxes!
4. It is a safe investment. Industrial real estate is well-maintained and usually has low crime rates, making it a safe investment for you and your family.
Since the Dodd-Frank Wall Street Reform and Consumer Protection Act, how has industrial real estate changed?
The market for industrial real estate has greatly improved since the Dodd-Frank Wall Street Reform and Consumer Protection Act was passed in 2010.
This is due in part to the increased regulation and compliance requirements that have come along with the legislation. Right now|
In addition, the market has been bolstered by increasing demand for industrial space, as businesses increasingly turn to these properties as a key part of their operations.
Some of the primary factors contributing to industrial real estate’s recent success include the ones listed below:
1) Increased Regulation:
Since the Dodd-Frank Act was enacted; there has been a significant increase in regulation and compliance requirements for businesses operating in the industrial space.
This includes things like updated fire safety codes, stricter building codes, and heightened scrutiny of financial transactions related to this sector.
As a result, many businesses are now reevaluating their entire industrial portfolio in order to meet these new standards.
2) Increasing Demand for Industrial Space:
In the addition to regulatory changes, there has also been an increasing demand for industrial space from both small and large businesses.
This is due in part to the fact that these properties tend to be more efficient than other types of spaces, providing businesses with more room to grow without
The industrial real estate market continues to dominate, with the majority of transactions being for Class A and B properties. Read more
The top markets remain those in major metropolitan areas, where there is an abundance of available space and high demand for new construction.
Buyers are looking for properties that offer a good return on investment and easy access to transportation and businesses.