TAG Industrial Watch: November 12, 2022
The nation’s largest industrial landlord, Prologis, has recently announced that it will significantly scale back the development of speculative warehouses, citing that two of its biggest tenets (Amazon and FedEx) have slowed down their pace of leasing (The Motley Fool). The slowdown in warehouse demand comes at the very moment the nation is experiencing its biggest boom in industrial development, with over 700 million square feet under construction.
While the threat of overbuilding has gone from unthinkable just a year ago to a reality today, not all industrial landlords need to be concerned. Much of the new development is concentrated in big box facilities. Properties 200,000 square feet and over make up 79% of the pipeline, versus less than 3% for small industrial facilities up to 50,000 square feet (CoStar). While often overlooked, small industrial is in a much better position to weather the imminent economic storm.
I N D U S T R I A L N E W SHessam Nadji: How We Got to Where We Are and What’s Next Here’s Why Prologis Is a Red Flag for Economic Growth Prologis Pivoting Away From Spec, Ramping Down Dispositions as Market Softens Demand for Industrial Space Is Slowing Down. But It’s Still a Landlord’s Market Inflation, Interest Rates and the Industrial Market
R E G I O N A L N E W SCRE Future Leaders: Tyler Sharp of Marcus & Millichap State of DFW Top 5 Industrial Transactions in Chicago Tesla Rents 440,000 SF Warehouse in San Antonio U.S. Port Markets See Outsized Industrial Rent Growth, Dwindling Availability |