WASHINGTON, DC-There is a new face in Jones Lang LaSalle's Industrial Practice Group for the Mid-Atlantic region. Robert Foa has joined the firm as a VP, bringing with him more than 10 years of experience in industrial investment sales and leasing.
GlobeSt.com caught up with Foa to get his take on where industrial is heading. Here are his thoughts on:
The Flight To Quality. As expected during a downturn we've seen quality tenants moving to better, more modern space as it becomes available. As a result the fundamentals for class A product are strong. Rents have stabilized, vacancy is declining and cap rates remain very low. On the flip side, owners of older industrial assets that lack ceiling height, modern truck courts, outside storage, and esfr sprinklers, and need to provide meaningful differentiators to get lease transactions completed.
The Lack of Supply. Class A product and developable industrial ground in close-in submarkets is extremely supply constrained and will continue to command attention from both tenants and investors. Much of the inventory in the Baltimore/Washington region is 40+ years old and quickly becoming obsolete. How owners of this older product position these assets against their competition will be critical in order to add value.”
Owner/User Demand. One promising trend I've noticed recently is the slow but steady growth of small business investment in real estate. The small to medium size industrial user that has weathered the economic downturn now finds themselves in an environment where they have access to cheap capital, a more confident customer base, and in many cases less competition for their product or service. This is a great opportunity for this segment of the market to consider buying a building or expanding their current footprint while rents are favorable.
GSA / Government Demand. Until we have a federal budget in place and the full effects of sequestration are realized, owners of real estate with short term leasing exposure to GSA and/or government contractors will be on edge and should seek assistance in navigating the public sector.
JLL Industrial. JLL is building a new client- centric Industrial Practice Group which will focus on delivering results through collaboration and by providing meaningful value-add solutions in all facets of our business.
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to asset-and-logo-licensing@alm.com. For more inforrmation visit Asset & Logo Licensing.
