Search
 

Why Rents Are Soaring in Otherwise-Obsolete Industrial

Last-mile industrial is bringing new life to outmoded facilities that are well located, and rent spreads between classes are expected to continue tightening as more last-mile users target these spaces, C&W's Jeff Chiate tells GlobeSt.com.

By Carrie Rossenfeld | Updated on January 09, 2018

Jeff Chiate Chiate: “Rent spreads are currently 10% between class-A and -B/C buildings, whereas just two years ago spreads for these same classes were as much as 30% to 40%.”

IRVINE, CA—Last-mile industrial is bringing new life to outmoded facilities that are well located, and rent spreads between classes are expected to continue tightening as more last-mile users target these spaces, Cushman & Wakefield’s executive managing director, industrial capital markets, Jeff Chiate tells GlobeSt.com.

According to a recent report from the firm, the strong demand generated by e-commerce has put significant upward pressure on rental rates for both class-A and -B assets. As the e-commerce industry continues to explode, companies are intently focused on getting the product to the consumer quickly and efficiently via the “last mile”—which will remain a primary generator of demand ahead. As a result, well-located class-B properties, which five years ago may have been considered obsolete, are now highly sought-after spaces in the infill Orange County markets.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.