US warehousing in 2018: Tight supply, higher rent
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The availability and cost of quality distribution space in 2018 should be almost a mirror image of conditions in 2017. That is good news for owners and lessors of warehouse and distribution space, but beneficial cargo owners (BCOs) should anticipate tight supply and rising rents in the coming year.
Customer activity in the third quarter of 2017 was at its highest level since 2014, according to the Prologis Industrial Business Indicator. “Continued demand and developer discipline kept the vacancy rate at an historically low level,” the report stated. Nationwide, the vacancy rate for industrial properties was 4.6 percent, but in seaport-dependent regions such as Seattle-Tacoma, the San Francisco Bay area, Los Angeles-Long Beach, and northern and central New Jersey, BCOs are encountering even lower vacancy rates.
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