Why Industrial Remains One of the Hottest Segments in the Commercial Real Estate Industry

For the foreseeable future, it seems industrial will remain a hot market segment especially in areas that have high demand and limited land supply. As our society becomes more dependent on technology, so does the need for distribution centers and warehouses. It is important for big companies such as Amazon and Zappos, to have footprints in areas to service densely populated urban areas such as NYC.

What once was the last mile delivered, is more like the last 50 miles nowadays. With the emergence of robotic deliveries and drones, the online retail segment will continue to be an efficient way for customers to get their products. As highly populated areas such as Manhattan, institute congestion pricing, it will become more important than ever for companies to have facilities close enough to service that segment in a timely fashion. Companies such as Fresh Direct, have strategically placed distribution centers in Long Island City and Philadelphia to service NY and NJ.

In addition to the convenience of same day or 24-hour delivery, potential trade talks and tariffs can have an impact on the industrial segment. As manufacturing and fabrication return to the states, we can see the emergence of an even greater need for industrial space. For many years companies that found it more cost effective to outsource, now might think twice about doing so and instead, invest in industrial facilities.