MIAMI—What types of projects is industrial money targeting and why? GlobeSt.com found the right man to ask: CBRE's Jack Fraker.

Fraker will be on hand at RealShare Industrial Miami next week. In the meantime, we caught up with him to talk about where he sees the money going. His short answer: class A bulk industrial in major supply chain cities and gateway markets. But, he said, there is a four-to-one imbalance between investor demand and these type of offerings on the market.

“This imbalance is creating frenzied competition between investors and forcing investors into either secondary markets or slightly older vintage productthat is still functional,” Fraker tells GlobeSt.com. “Properties with a high level of functionality—clear height, truck court depth, parking, building depth, column spacing, etcetera—are the dominant criteria for institutional investors.”

Fraker points to light industrial properties in primary markets—mostly focused on in-fill sites—as attractive to investors and lenders. He reports light industrial vacancy levels have significantly decreased and rents have grown as certain sectors such as single family housing and automotive continues to recover.

We hear plenty about e-commerce's impact on industrial and Fraker is seeing it. He says e-commerce-oriented facilities, including smaller projects for the last mile of delivery, are in demand and points to stats that show 40% of big box industrial requirements are related to e-commerce with a 20% growth rate.

“E-commerce and omni-channel retail require sophisticated logistics and supply chains, thereby increasing the demand for well-located and modern facilities,” says Fraker. “Investors are interested in core, core plus, and value-add offerings. Value-add definition is broadened to include vintage rent rolls in the 2008-2012 time horizon when lease rates were well below the historical average lease rate.”