What Does Industrial’s Future Look Like?

April 9, 2019

What Does Industrial’s Future Look Like?

April 9, 2019 | Natalie Dolce | GlobeSt.com

Warehouses are getting smarter, and distribution channels are getting more efficient. As consumers demand faster delivery of goods, the industrial sector will play a huge role in making that happen and technology will be the driver. That is according to Jimmy Ullrich, director of Stan Johnson Co., who recently chatted with GlobeSt.com on demand for industrial product and what he future looks like for the sector.

GlobeSt.com: What’s driving demand for industrial product in today’s market?

Jimmy Ullrich: Industrial is really the belle of the ball these days, and demand is coming from three directions. First, the reconfiguration of retail’s supply chain is driving demand for both warehouse and distribution space. Secondly, institutional capital has fallen in love with the asset class – they’re coming into the space in droves, driving down yields. I never thought I’d hear “Greenville-Spartanburg” as a buzz word on the streets of New York City, but quality product in markets of all sizes can be really attractive in today’s market. Lastly, my favorite driver of demand is coming from private buyers. 1031 exchange buyers who have spent decades buying low cap rate retail properties are growing weary of negative headlines. The doom and gloom – whether real or perceived – surrounding portions of the retail sector is causing some private buyers to migrate to industrial, which can offer better yields.

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