Retail-to-industrial property conversions accelerate in U.S.

Retail-to-industrial property conversions are accelerating across the U.S., driven by the growth of e-commerce. There are now 59 such projects that have either been completed, proposed or are underway since 2017—up from 24 in January 2019, according to a CBRE Research survey. These projects total approximately 13.8 million square feet of retail space converted to 15.5 million square feet of industrial space.

Underperforming retail sites have become an ideal location for last-mile warehouse developers. They are often located within population centers, connected to utilities and have large parking lots with multiple points of ingress and egress. Many are also freestanding big-box stores with existing dock doors and clear heights compatible with industrial use. Those without compatible design formats are typically demolished and replaced with modern warehouse facilities.

The top five markets for these conversion projects are Milwaukee, Cleveland, Chicago, Omaha and Dall