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PHILADELPHIA-Two of the best places in the country to buy industrial real estate these days are Philadelphia and Columbus, OH, according to a study of America’s Top 10 Industrial Investment Markets for the first six months of this year by Sperry Van Ness. One of the main reasons for Philadelphia’s attractiveness is the area’s very stable ownership ofindustrial properties, says John McDermott, regional manager for Sperry Van Ness, which recently expanded its presence in Philadelphia.

“People tend to own the buildings forever, and that makes for a very inefficient market,” McDermott says.

Add to that a tradition of buying and selling properties on their own–or, on the flip side, to use brokers–and you see higher yields and lower prices per foot, he says.

“There are a lot of friend-to-friend transactions,” McDermott says. “They leave a lot of money on the table.”

As more and more brokerage firms come to the city, he expects prices will rise.

One factor that depresses prices is high property taxes–as well as use and occupancy taxes, McDermott says. Pennsylvania’s General Assemblyrecently convened a special session to address the problem.

Philadelphia 11.25% yield, or average price of $36.39 per sf, is second only to Columbus, which has a 12% yield and an average price of $29.75 per sf.

“At this time, many clients are looking for higher returns on their investments by selling industrial properties in regions like Seattle, Ventura and San Diego, and utilizing a tax-free exchange intomarkets such as Columbus, Philadelphia and Houston,” says David Frosh, president of Sperry Van Ness, in a release.

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