The cold truth about what’s hot in niche real estate

The operative phrase here is this: cold storage.

It’s hot among investors. The metrics tell the tale: National cold storage development hit an all-time high of 9.8 million square feet by the end of 2022, driven by a proliferation of users and operators as the sector grows and evolves. The number of cold storage establishments grew 8.6 percent from 2020 to 2021 and an additional 7.5 percent from 2021 to the first half of 2022, eclipsing the annual average of 2.2 percent observed from 2013 to 2020.

That is part of the research assembled and analyzed by Newmark, the commercial real estate products and services firm, in its March 2023 report Sold on Cold: Temperature-Controlled Development Pipeline Reaches New Record. Driving the chill are a few factors, according to Newmark: aging inventory, industry consolidation, and acceleration of food and grocery ecommerce and supportive last-mile operations, particularly in fast-growing Sun Belt metros.

Let’s tak