Chicago – Sept. 24, 2018 – Demand for e-commerce distribution space was the impetus for many of the largest Industrial & Logistics (I&L) leases completed in the U.S. in the first half of this year, highlighting users’ preference for large, modern facilities, according to a new report from CBRE.
Chicago was a top target for this activity, completing 11 deals for 6.8 million square feet of I&L leases, trailing only California’s Inland Empire (14 deals for 11.6 million sq. ft.), Atlanta (10 deals for 7 million sq. ft.) and Pennsylvania’s I-78/I-81 corridor (10 deals for 6.8 million sq. ft.). Dallas-Fort Worth rounded out the top-five markets with eight deals for 5.2 million sq. ft..
“Chicago continues to be a vital market for the industrial supply chain,” said Traci Buckingham Payette, executive vice president with CBRE. “E-commerce and logistics firms are driving the majority of this activity and as more consumers turn to on-line shopping, this trend will remain prevalent and likely expand even more.”
CBRE’s analysis of the 100 largest leases for I&L space by square footage found that 56 were signed by e-commerce companies and third-party-logistics companies (3PLs), which predominantly handle distribution for goods purchased online.
The balance of the first half’s largest I&L leases were signed by manufacturers (14 leases), food and beverage providers (11), retailers (seven), technology companies (four) and an “other” catch-all category (eight).
CBRE found that 30 of the leases were for warehouses larger than 750,000 sq. ft., reflecting e-commerce users’ preference for expansive facilities with high ceiling heights and, in many cases, modern specifications for automation and rapid movement of massive inventories. Cumulatively, the 100 largest leases span 67.8 million sq. ft.
“The supply chain arms race is as competitive as it’s ever been,” said Adam Mullen, CBRE Americas Leader of Industrial & Logistics. “While e-commerce is driving many new leases, there still is a solid diversity of users throughout the top 100 leases. That’s good for the warehouse and distribution industry overall. And the strength of leasing to 3PLs shows that companies are striving to create the most flexible and nimble distribution networks possible.”
To read the report, click here.
Chicago was a top target for this activity, completing 11 deals for 6.8 million square feet of I&L leases, trailing only California’s Inland Empire (14 deals for 11.6 million sq. ft.), Atlanta (10 deals for 7 million sq. ft.) and Pennsylvania’s I-78/I-81 corridor (10 deals for 6.8 million sq. ft.). Dallas-Fort Worth rounded out the top-five markets with eight deals for 5.2 million sq. ft..
“Chicago continues to be a vital market for the industrial supply chain,” said Traci Buckingham Payette, executive vice president with CBRE. “E-commerce and logistics firms are driving the majority of this activity and as more consumers turn to on-line shopping, this trend will remain prevalent and likely expand even more.”
CBRE’s analysis of the 100 largest leases for I&L space by square footage found that 56 were signed by e-commerce companies and third-party-logistics companies (3PLs), which predominantly handle distribution for goods purchased online.
The balance of the first half’s largest I&L leases were signed by manufacturers (14 leases), food and beverage providers (11), retailers (seven), technology companies (four) and an “other” catch-all category (eight).
CBRE found that 30 of the leases were for warehouses larger than 750,000 sq. ft., reflecting e-commerce users’ preference for expansive facilities with high ceiling heights and, in many cases, modern specifications for automation and rapid movement of massive inventories. Cumulatively, the 100 largest leases span 67.8 million sq. ft.
“The supply chain arms race is as competitive as it’s ever been,” said Adam Mullen, CBRE Americas Leader of Industrial & Logistics. “While e-commerce is driving many new leases, there still is a solid diversity of users throughout the top 100 leases. That’s good for the warehouse and distribution industry overall. And the strength of leasing to 3PLs shows that companies are striving to create the most flexible and nimble distribution networks possible.”
To read the report, click here.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas is the world’s largest commercial real estate services and investment firm (based on 2019 revenue). The company has more than 100,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 530 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas is the world’s largest commercial real estate services and investment firm (based on 2019 revenue). The company has more than 100,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 530 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
