The New Industrial Real Estate Business

The New Industrial Real Estate Business

If you are buying, selling or leasing, today’s industrial real estate business has permanently shifted. It has become an investor led market that was originally established for Occupiers. Investment fundamentals supersede many traditional occupancy concerns. Industrial markets became financialized because of strong and increasing money flows from institutional funds, REITs and private investors. In the New Industrial Real Estate Business, profits accrue fastest to those who treat their buildings like an investment product. The primary market driver is improving income through rental increases, operations, and tenancies. The wave of financialization is affecting most local industrial markets in the best metros and is visible building-by-building. Technical sophistication and specialized platforms are the new means of operating in today’s industrial building business.
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Industrial Buildings: From Private Hands to Institutional Buyers

Industrial Buildings: From Private Hands to Institutional Buyers

One of the longest running trends in industrial real estate is the shift of ownership from private hands to institutions. Traditionally, insurance companies, pension funds, and real estate investment trusts (REITs) would purchase new developments and industrial parks after they had been leased and stabilized. It served as both a guaranteed exit for entrepreneurial developers as well as the way investors would acquire property to match long term obligations.
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Geodata, MappSnap and Industrial Real Estate

Geodata, MappSnap and Industrial Real Estate

Geodata is widely used in many commercial internet applications like Yelp, Google Maps, Twitter, Foursquare and Factual. Many of these web services match your phone’s location to their own mapping programs. In most cases location data is an aid to sell goods and services. I use the same relationship between point data and the connected internet to find more real estate deals using MappSnap.


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A Backwater No Longer

A Backwater No Longer

As industrial moves from being an operations decision to a financial product, it’s no longer a sleepy backwater of the investment world. Institutional Capital has permanently changed markets from locally owned and operated to globally owned and tenanted. It’s a 40-year trend beginning with the first wave of Japanese corporations and now exploding with institutional capital since the 2008 Financial Crisis. The influence of institutional capital makes it a different business. The driver is no longer business operations but financialization.
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Four Current Forces of the Industrial Real Estate Business

Four Current Forces of the Industrial Real Estate Business

The current robustness in industrial real estate markets obscures many forces that can balance and protect your investment and location decisions. Technology, Monetary Policy, Political Risk, and Space Transparency are important factors that provide support during good times and bad.
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European Opportunities for U.S Occupiers and Investors

European Opportunities for U.S Occupiers and Investors

I just returned from the SIOR European Conference in Warsaw, Poland. It’s my third visit to Europe recently and the most persistent trend is the expansion of big warehouse development. It’s leading to opportunities for U.S. occupiers and investors mainly due to the strength of the dollar.
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Industrial Building Portfolios – In Heavy Demand

Industrial Building Portfolios – In Heavy Demand

Industrial Building Portfolios, $50MM and greater, are where the action is today. Institutional investors need scale and the only place to find it, as far as industrial, is in the portfolios of National Operating Companies and Private Partnerships. Institutional Investors stand between the real estate and fixed obligations to satisfy pension, insurance, and retirement plans. It’s major financial plumbing and as the obligations grow so does the need for product. Roll ups, a familiar consolidation vehicle in corporate America, is now the preferred way for large real estate investors to buy. Unknown to many, national industrial building ownership is consolidating and almost all local developers/investors sell into these relatively few pools as a final exit.
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