March 28, 2022
Investors jump in early in industrial sector
Increased demand makes warehouses attractive even before they are built or leased The already hot industrial real estate sector...

Investors jump in early in industrial sector

March 28, 2022 | Arleen Jacobius | Pensions & Investments

Increased demand makes warehouses attractive even before they are built or leased

The already hot industrial real estate sector is burning up with demand that’s so fierce investors increasingly are competing to buy warehouses before they are built or leased.

Traditionally, investors were loath to take on development and leasing risk, preferring to buy warehouses when completed and with tenants in place. But industrial rents are rising quickly — with first-year comparable rents up 10.8% in 2021 from a year earlier, according to CBRE research — and consistent growth in leasing rates is causing investors to be less concerned with those risks.

According to MSCI Inc.’s RCA Commercial Property Price Indices, industrial prices rose a record 28.1% in the 12 months ended Jan. 31. That’s faster than the growth in any other property sector in the period, besting apartments’ 22.5% increase.

Real estate executives say the industrial properties segment still has room to grow.

“If you take any kind of view of the world that there could be reversion to the mean, it points to a peak,” said Richard Kleinman, Chicago-based head of LaSalle Investment Management’s U.S. research and strategy group and co-CIO for the Americas. But investors expect rents to continue to rise and, so far, they have been right because supply has lagged demand, Mr. Kleinman said.

≡ Read Article

Recent

Most Popular

Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update 10-3-2023 Blue Vault wishes to acknowledge and apologize for the delay in publishing some Q2 2023 NTR Individual Performance Pages (IPPs) as well as the full review. We recently added additional reporting metrics to our IPPs, and that, combined with coverage of all share classes and some additional…
Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update 9-25-2023 Blue Vault has published the Q2 2023 Nontraded BDC Industry Review as well as Individual Performance Report and Limited Operations pages for the following offerings (newly published pages in bold font): Nontraded REITS American Healthcare REIT Q2 2023 Apollo Realty Income Solutions Q2 2023 (limited operations) Ares…

Explore

Blue Vault Logo
Don’t miss alts news
and educational events

Subscribe Now