Despite Potential Problems, Industrial Market Looks Solid Heading Into 2001

PORTLAND-Semiconductor makers and their suppliers made 2000 a solid year in the industrial real estate market, and 2001 should be just as good given a continued supply of skilled workers and relatively inexpensive housing. This is the summation of Grubb & Ellis, the first real estate services company to come out with a 2000 Review/2001 Forecast report for the greater Portland area, which includes the so-called Silicon Forest west of the city and southwest Washington State.

“We approach 2001 with cautious optimism in the Portland metro area as the Oregon high-technology sector predicts robust growth in the coming years,” concludes the report. “However, most economists agree that the rapid expansion of the last several years is slowing down and leading economic indicators seem to confirm this.”

If land and labor continue to provide viable opportunities, the trend toward low vacancy rates and new development will continue. Industrial vacancy rates are at their lowest level since 1995. The vacancy rate in warehouse and manufacturing space dropped four full points in 2000, net absorption posted an all-time high of more than five million sf, and rental rates were up.