LOS ANGELES—Some developers are concerned that the major industrial markets—namely Los Angeles, San Francisco, Miami and New Jersey—are “frothy” at this point in the cycle, according to Jim Klein, SIOR, the president of Klein Commercial. Klein is moderating the CEO Power Panel at NAIOP‘s I.CON ’15 conference June 10 and 11 in Long Beach. The panel is staked with developers who will talk strategy and the state of the market, as well as some of the challenges they are facing, despite the soaring demand.
“All the developers feel very comfortable with the market right now. They see at least a few good years ahead,” Klein tells GlobeSt.com. “The biggest concern is that developers think that these markets are frothy, and at this point, several are very careful now about what they buy. The opportunities in those top markets to make some money really happened a couple of years ago, so most seem focused on infill projects, if they can find them, because those seem somewhat less risky. However, in infill markets, unfortunately, it is mostly bad pieces of land and sites that are environmentally challenged. I would say that developers are picking markets that are less intense at this point.”