MIAMI—The industrial market in Florida is more than recovering—it may be set to lead the nation as so-called megapolitan areas rise up and serve as hubs that allow logistics companies to optimize their real estate portfolios. So says a new report from CBRE.
The commercial real estate firm reports companies are heavily scrutinizing transportation costs in East Coast and West Coast seaports—and inland cities with strong transportation links—locating facilities in markets best able to serve established and emerging megapolitan areas. Florida may lead the charge.
“Distribution and fulfillment users need a real estate footprint that allows them to move freight through the U.S. transportation network as fast as economically feasible,” says Scott Marshall, executive managing director of industrial services for the Americas at CBRE. “Future location decisions will largely be driven based on population growth—the East Coast and West Coast ports with the infrastructure and transportation links to serve the largest and fastest growing regions in the country will also be home to strong-performing industrial real estate markets.”
With the US population expected to grow by 100 million people by 2040, CBRE predicts 20 megapolitan markets will link shared transportation networks, labor markets and/or water supplies. CBRE expects these 20 megapolitan areas to house about two-thirds of the US population by 2040 and capture most of the money invested in development and growth.
North Florida’s population is expected to increase by 1.2 million people, or 31%, between 2013 and 2040, according to the Florida Bureau of Economic and Business Research. Central Florida’s population is expected to increase by 2.7 million people, or 39%. South Florida’s population is expected to increase by 2.4 million people, or 29%.
“Significant and ongoing investment in Florida’s seaports, airports and intermodal transportation infrastructure is driving industrial development throughout the state and attracting investors and businesses to the region,” says CBRE South Florida managing director Ken Krasnow. One of the overarching takeaways, especially for Florida, is this: the continued investment in transportation infrastructure is crucial.
CBRE’s defined megapolitan markets are: Florida Corridor and Treasure Coast, Texas Gulf, Texas Corridor, Greater Metroplex, Sun Corridor, Southern California, Northern California, Willmette Valley, Puget Sound, Front Range, Lakefront, Michigan Corridor, Steel Corridor, Ohio Valley, Georgia Piedmont, Carolina Piedmont, Chesapeake, Mid-Atlantic and New England.