"The real issue with industrial product is that the markets arefundamentally in such good shape that everybody's happy holding,"says Cary Krier, senior vice president in JLL's industrial servicesgroup in Dallas. "That's dried up all the liquidity. Even if youwant to buy, it's hard to find a seller. Everybody's paying therent and doing well."

According to Krier, a major factor behind the strongfundamentals is the continued, and somewhat surprising, strength ofthe retail industry. Though he acknowledges there are some signs oftapering, he says retail is doing much better than many peoplerealize and certainly much better than analysts predicted. "You gothrough these warehouses, and people are still ordering andhiring," he remarks. "I don't know if they're just reluctant to layoff people or what. But nobody's giving back space. We don't have alot of sublease space creating a shadow inventory."

Manufacturers are also doing well, he adds, largely due to thedecline in the dollar making US goods more competitive in terms ofprice both at home and abroad.