Industrial Fundamentals Improve Across US

CHICAGO—The US and Canadian industrial markets continued to improve in the past year, with user demand pushing down vacancy rates in almost every market and swelling the development pipeline in a far smaller group of regions, according to Avison Young’s Spring 2015 Canada, US and UK Industrial Market Report, released earlier this week. The company’s experts also believe that the sector will continue growing steadily in 2015. Volatile energy prices remain an unknown factor, but should only impact particular markets and industry sectors. And new development, although steady, will remain relatively modest in many markets.

“It’s low, and this is indicative of a development market that is being tempered by the need for real equity,” Erik Foster, principal and practice leader of Avison Young’s Chicago-based industrial capital markets team, tells GlobeSt.com. Prior to the recession, developers could sometimes launch a project after kicking in only 10%, but today much more is required, and “it is causing a lot of developers to be more strategic.”