WHAT'S IN INDUSTRIAL REAL ESTATE FUTURE?

At the end of the day, industrial markets in notable population centers will continue to fare well: It’s a matter of where goods ultimately end up, rather than where they enter the continent, says Levy.

Curious which ports are best positioned for 2016, 2021 and beyond and why? GlobeSt.com got the answer as we recently chatted with Mark Levy, JLL managing director and lead of JLL’s Ports Airports and Global Infrastructure practice group. Levy also talks about the future of industrial, how the utilization of space has changed and more in the exclusive Q&A below.

GlobeSt.com: What current trends are influencing demand for industrial real estate?

Mark Levy: Several national economic indicators are healthy. When comparing 2007 to 2014, there were 18.2 million more people/consumers in the US; total retail sales were up 17.3%; and ocean containerized cargo volume (measured in TEUs) was 8.1% higher. Additionally, the nation’s housing market is progressively recovering, which benefits big-ticket retail item sales such as furniture and major appliances.

All of these influence demand for industrial real estate. JLL actively tracks tenant requirements in excess of 100,000 square feet to offer a glimpse into which industries will impact the nation’s industrial markets, and demand totaled 249.3 million square feet across the nation in June 2015. By industry, retail requirements led with 75.8 million square feet, while 3PLs & transport companies followed with 45.6 million square feet. 

GlobeSt.com: How has the utilization of industrial space changed in the past 10 years?

Levy: Automation has become increasingly important as a means to expedite the flow of goods into and out of a facility. So has maximizing the operational efficiencies of how space is utilized. As a result, many of the features of today’s modern buildings are very different than what they were 10-years ago.

Here is a hypothetical comparison of a ‘modern’ facility:

Then (1995)

Average facility size: 230,000 square feet

Column spacing: 40’ x 44’

Clearance height: 28’

Number of dock-high doors per 10,000 square feet: 1.3

Average truck court depth: 130’

Truck parking per 10,000 square feet: 2.2

Now (2015)

Average facility size: 550,000 square feet

Column spacing: 52’ x 52’

Clearance height: 32’ to 36’

Number of dock-high doors per 10,000 square feet: 3.5