Industrial and Multifamily Boom in the Southwest as Some Retail Lags
February 14, 2022 | JP Morgan Chase | Commercial Observer
Between wildfires and the COVID-19 pandemic, it’s been a dynamic two years for Southern California and the Southwest. Partner Insights spoke to Matt Felsot, Southwest regional manager of real estate banking at JPMorgan Chase, about how commercial real estate is faring in the area.
Commercial Observer: What has been the biggest shift in commercial real estate in the Southwest region since the beginning of the pandemic?
Matt Felsot: We’ve seen a remarkable acceleration in the e-commerce space since Los Angeles and Long Beach, Calif., are home to massive ports. Together, they handle 40 percent of U.S. imports, so the increased activity and supply chain disruptions have caused increased demand of the existing surrounding warehouse stock. In October 2021, there were 900,000 TEUs [twenty-foot equivalent units, which is a measure of cargo capacity] of industrial cargo moving through. That’s the highest ever in October. So, the ports are fueling all the industrial properties in the area and keeping vacancies at 50-year historic lows.
