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Warehouse Properties May Be Losing Luster

CHICAGO-The product type may no longer be the low-volatility, bread-and-butter play it traditionally has been, suggests Real Estate Research Corp. CEO and managing principal Kenneth P. Riggs Jr., whose company co-authored a 2004 forecast.

By Mark Ruda | Updated on December 19, 2003

CHICAGO-Investing in warehouse properties may no longer be the “bread-and-butter” play it has long been, suggests Real Estate Research Corp. CEO and managing principal Kenneth P. Riggs Jr. “We believe industrial is a lot more controversial than people report,” says Riggs, whose company co-authored a 2004 forecast.

“Warehouse has always been considered a bread-and-butter, low-volatility product type, but those days are over,” Riggs tells GlobeSt.com. He points to new developments such as CenterPoint Properties Trust’s Ford Supplier Park on the city’s Southeast Side, which takes just-in-time inventory controls and other technology to another level. “They know within 30 minutes when parts will be put on an assembled car,” Riggs notes.

However, Principal Real Estate Investors, which also co-authored “Expectations & Market Realities in Real Estate: 2004″ with Torto Wheaton Research, is “very bullish about warehouse demand,” says president and chief investment officer Randall C. Mundt.

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