Steve Sakwa, directing Merrill Lynch's current research andforecasting efforts on REITs, warns against investing within "theindustrial sector, [in those] companies that have relatively lowlevels of pre-leasing." He noted, "With the economy slowing andrent growth moderating in many markets, we believe that significantcost overruns will no longer be compensated with higher thanexpected rents, which would lead to lower than expected developmentreturns."

Despite this, Cushman & Wakefield says it's planning tofocus renewed energy on the industrial sector. In its efforts, NewYork-based C&W has named a new senior managing director ofindustrial services, Pamela Zoellner. The firm's North Americanpresident Bruce Mosler announced, "Industrial, as well as retailand technology, is a main focus point for our firm in 2001 andbeyond."

When asked to discuss the company's confidence in the sector,Zoellner tells GlobeSt.com in an interview, "It's true e-commercehas not really proved out; a lot of them are folding as quickly asthey were launched. There was overbuilding in some markets ofwarehouse space for these businesses and other similar e-industrialfunctions." Despite this, though, she says, "We are going to getmore and more involved in industrial."