LOS ANGELES-There was cautious optimism in the air at the 2013 NAIOP I.con: The Industrial Conference, which began yesterday at the Omni Hotel here.

Whether you heard caution or optimism, though, depended on which moments of any particular panel you caught. Because most of the presenters, perhaps mindful that the traumas of the Great Recession aren't too far in the rear-view mirror and that the recovery is still uncertain, seemed to veer between the two extremes.

Still, the sentiment of the day among the 400 attendees was feeling good, and most in attendance seemed to believe that things in the industrial sector are getting better, even as new challenges present themselves on a daily basis.

E-commerce was the big focus of I.con's day one, with talk of Amazon's imminent move to expand its Amazon Fresh grocery concept one particular highlight. The “Expansion of E-Commerce and its Affect on Industrial Real Estate” panel was a particular hit, as attendees were wowed by the sheer force of Amazon's growth--an expansion anticipated to hit 95 million square feet and 17 distribution centers either proposed or planned, particularly as the Amazon Fresh rolls out in Los Angeles and San Francisco in the coming months.

Curtis Spencer, the president of IMS Worldwide, said one third of all demand for big box buildings was for multichannel or e-commerce companies. He said the key to attracting e-commerce tenants is avoidance of the nexus tax on affiliates; proximity to major markets; ample labor pools to handle seasonal and surge tasks; inexpensive land; reasonable proximity to interstate highways; and local incentives to locate.

“The pace of change is driving a lot of industrial deals,” Spencer concluded and noted that there are not “a plethora of 500,000-square-foot buildings available.”

Kevin Rogus, the SVP of Duke Realty, mentioned local incentives as a key to closing deals with potential e-commerce clients, although noting that the finalizing of such incentives can cause contract signings to drag.

Carlos Vega, the regional director–West Coast sales for Dematic, said a key was being near FedEx and UPS ground hubs, although Amazon is exploring starting its own version of those services. And don't overlook the e-commerce companies that are a tier below Amazon, Vega said. There are credit-worthy companies coming online that will provide industrial providers with opportunity.

On the “Power Brokers” panel, Stanley Alterman, the executive managing director of USAA Real Estate Co., allowed that “the market generally is pretty good,” citing the net absorption of 63 million square feet in the trailing 12 month period. “It's all positive signs,” he said, mentioning housing on the uptick, but then noting that manufacturers just declared their worst month ever in the US.

Rent growth, Alterman says, is expected to be growth positive for 2012, with CBRE predicting a 3.7% increase this year.

As the panel went market-by-market for panel assessments, Bill Waxman, the EVP of CBRE, termed things in New Jersey as “getting back to where we were. We're in the upswing for development,” he said. “We're hoping to see more in the next couple years.” The food industry is a particular driver in his market.

Chuck Belden, the executive director of Cushman & Wakefield of California Inc. said the Inland Empire market is “fantastic. It's a very strong rebound.” He noted that they are now back at pre-recession levels, and said later that there's still consolidation going on in large global companies.

David Bercu, the principal of Colliers International in Chicago, said that his market is battling perceptions, noting a huge unfunded pension liability by the state as one potential sticking point for growth. His hottest market is land near the airport, he said, later noting that some privately held company decision-makers are still concerned about pulling the trigger on long-term lease commitments. But he did note that the automotive industry is recovering, and there's the potential for more, as car owners finally begin trading in vehicles they've held for longer periods during the recession.

Rodney Davidson, the VP of Jones Lang LaSalle, said Atlanta was “seeing improvement in its industrial market, with big boxes their most active sector. “The 40,000-100,000-square-foot deals are what we need to see,” he said, although noting that the area is “seeing a flight to quality.” He later mentioned that his area is watching for increased job creation. “They've got to be working,” he said.

Finally, the afternoon was capped with the “CIO Roundtable,” led by Marcus & Millichap managing director for Commercial Property Groups Al Pontius. He started the panel by pointing out several statistical disconnections to those who were feeling good about the state of industrial, noting that imports/exports are declining slightly and that US ports are showing only 2% annualized growth, both not good forward indicators.

Pontius also questioned the focus on e-commerce, nothing that the big space market is only 8% of the total industrial market across the US, and only 20% of the absorption over the trailing 12 months.

The panel opinion on where things are heading was mixed. Bryan Blasingame, the CIO of IDI, felt that capital was driving things. Jim Clewlow, the CIO of CenterPoint Properties, echoed that, noting that capital is now seeking investments in other markets outside of the coasts.

Larry Harmson, the COO of Prologis, said that most of the demand he's seen was for class-A properties, “some B in the top markets. It's been primarily about the best stuff.”

Jeff Phelan, the president of DCT Industrial Trust, said corporate consolidations are driving things. “It's a fundamental answer to why we're having healthy absorption today,” he said.

The top markets for building on spec were pegged by the panel as Southern California, Houston, Miami and Seattle, with at least one panelist mentioning Chicago, while another voted for Oakland. Most markets will see some spec development in the next year, the panel agreed.

One other issue that bears watching is the creep in construction prices. Phelan pegged the rising costs at about six percent on a yearly basis, and also cautioned that entitlement costs are going up.

NAIOP's I.con: The Industrial Conference continues today at the Omni through noon. Stay tuned for more coverage from the event.