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JLL Reports Industrial Market “On Fire”
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Healthy consumer spending and buoyant e-commerce sales are driving demand for warehouse and distribution space, pushing vacancy rates to a 17-year low and rents through the roof. But demand is outweighing supply, and new construction is struggling to keep up, according to research from JLL.
JLL’s Craig Meyer says, “Vacancies are at historic lows and in some markets, as low as two percent or less. Coupled with broad rental growth in some markets as high as double digits year-over-year, 2017 is already shaping up to be another great year for industrial real estate.”
With supply tight, the industrial construction pipeline is growing and being led by a significant increase in build-to-suits. The U.S. industrial market is projected to add nearly one billion square feet to its inventory by 2018.
The top five markets, which account for more than half of the new development starts in the first quarter, include Dallas, Inland Empire, Philadelphia, Denver and Atlanta.
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