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Transwestern’s Mark Glagola: E-Commerce Drives Industrial Demand
Transwestern’s Mark Glagola, Managing Director, Mid Atlantic Capital Markets, is among the line-up set to speak at Connect Industrial next month in Chicago. Leading up to the conference, Glagola shared a few insights into trends at play in the industrial sector, how challenges and opportunities are being met, as well as an example of how Wayfair is approaching its space needs in a fast-changing e-commerce setting.
Q: What are the primary trends driving the industry today?
A: The increasing number of retail sales occurring online has created significant demand for industrial space. E-commerce and logistics companies have experienced a tremendous increase in business as more consumers are ordering online instead of in stores, compounded by the ever-increasing expectation for speedy delivery. Additionally, tenants are focusing on upgrading older properties into more modern facilities that allow for higher efficiency, technological advancements and competitive recruiting.
Q: How are companies addressing the challenges and capturing opportunities?
A: While labor and distribution channels drive most business decisions, each company takes a different approach. The needs also vary by industry. For example, food manufactures typically need to be close to the end users, but it’s not as critical for, say, automotive manufacturers. That said, most companies are focusing on making their logistics more efficient by analyzing the best shipping routes; facility requirements such as height, column spacing, loading space, and number of doors; and just-in-time modeling.
Q: What are some examples of deals that reflect what is going in the marketplace?
A: One of the more interesting approaches to logistics is Wayfair, a huge e-commerce company that has leased 10 million square feet in last two years. The bulk of its leases were regional distribution centers, which the company put in Class B warehouses and only for three-year terms. The philosophy was that the world is changing fast, and Wayfair wanted the flexibility to move to new locations and change size quickly.
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