E-commerce, logistics firms lead industrial leases in 2018
E-commerce and logistics companies claimed a larger share of the 100 largest industrial-and-logistics leases signed in 2018 than they did a year earlier, underscoring the growing influence of those companies on U.S. warehouse construction, according to a new report by CBRE, Dealmakers: E-Commerce & Logistics Firms Dominate Largest Warehouse Deals in 2018.
CBRE’s analysis of last year’s industrial-leasing activity in the United States found that 61 of the largest 100 leases were signed by e-commerce companies and logistics firms for a total of 61.5 million square feet. In the previous year, those two sectors claimed 52 of the largest leases for a cumulative 43.2 million square feet.
“These figures illustrate that there still is a lot of momentum behind e-commerce uses in U.S. warehouse leasing, despite concerns that the sector's expansion may be reaching its later stages,” said David Egan, CBRE’s global head of industrial & logistics research. “We expect this type of leasing momentum to continue in 2019.”
The Dallas-Fort Worth market had 10 of the largest warehouse leases for a total of 11.1 million square feet in 2018, trailing only the Inland Empire in Southern California and the PA I-78/81 Corridor in Eastern Pennsylvania. Six of the leases in DFW were for e-commerce and logistics companies, putting the area on par with the national trend. These figures were slightly down from 2017, when 13 warehouse leases were signed in the DFW metroplex for a total of 11 million square feet Six of those leases were for e-commerce and logistics companies.
“In 2018, DFW’s industrial real estate market saw unprecedented demand for a multitude of reasons,” said Ryan Keiser, executive vice president with CBRE’s industrial & logistics practice in Dallas. “The growth of e-commerce — specifically the ever-increasing e-commerce service levels such as two-day, same-day and white glove delivery options — was a huge factor. We also are seeing demand for distribution centers due to the Metroplex’s location and transportation infrastructure, and we see strong local demand due to the area’s population growth.”
Last year’s largest industrial leases were spread across 32 markets, with many clustering in leading logistics hubs including California’s Inland Empire (20 leases), Pennsylvania’s I-78/I-81 corridor (11), Dallas-Fort Worth (10), Atlanta (nine) and Chicago (five). Others claiming several large leases were Columbus (four), Detroit (four) and St. Louis (three).