It’s a Seller’s Market in the Industrial Sector, But Investors Are Undeterred
Originally published by Patricia Kirk on March 22, 2021, for WelathManagement.com.
Soaring demand and constrained supply have caused industrial property values to rise for the past decade. But with the pandemic accelerating an increase in online sales, the industrial commercial property price index (CPPI) rose 8.8 percent over the previous year, with warehouse values surging 10 percent and flex industrial values rising 6.5 percent, according to a recent report from real estate date firm Real Capital Analytics (RCA).
And it’s not over yet, suggests Alan Pontius, senior vice president and national director with the office, industrial and healthcare divisions at real estate services firm Marcus & Millichap. He notes that operational expectations for industrial continue to be more bullish than in any other sector. “Expectations remain high for demand and rental growth, with any perceived supply risk limited to only a few markets and not seen as long term,” he says.