24C — May 25 - June 7, 2018 — Industrial / Distribution Centers — M id A tlantic
Real Estate Journal
I ndustrial R eal E state & D istribution C enters By Gerry Blinebury, Cushman &Wakefield Harrisburg Industrial Real Estate and theEasternPAMarket Region AMessage from Jay Olshonsky, president, NAI Global In May, the U.S. econo- my entered its 107 consecu- tive month of expansion (as estate industry, that property type remains an active target for acquisitions.
m e a s u r e d b y G D P ) and now has the longest e x p a n s i o n of the U.S. economy in i t s s i g h t s – t h e 1 2 0 months from
confident right from the very beginning that their job will be done right. For over 20 years, Key- struct Construction has been the contractor of choice for: Industrial Con- struction, Commercial Con- struction and Healthcare Construction. used in a variety of sealing applications that require high-temperature perfor- mance and excellent chemical resistance. The new facil- ity, which is double in size, will allow manufacturing of Kalrez parts to keep up with projected business growth. CBRE’s Daniel Reeder and Brian Hopkins repre- sented DowDuPont during the sales negotiations. CBRE has been representing Du- Pont in the state of Delaware for more than 25 years. At the recent SIOR Global Spring World Conference in Austin, keynote speaker Mi- chael Litt (his company was the main source for the book by Mike Lewis, The Big Short, and the movie with the same name) told the audience that his firm was investing in De- troit and in Milwaukee before adding: “Only New York and Miami may be overbuilt right now, but Nashville isn’t, Se- attle isn’t.” Extra innings or not, we be- lieve the Mid-Atlantic region as well as all of the U.S. is poised for continued growth in 2018 and well into 2019. NAI Global is a leading global commercial real estate services firm with more than 400 brokerage offices and over 7,000 professionals worldwide. The firm manages over 425 million square feet of property on behalf of its clients, glob- ally. The NAI Global Capital Markets Group serves the largest institutional owners of and investors in commercial real estate. NAI Global provides a com- plete range of corporate and institutional real estate ser- vices, including brokerage and leasing, property and facilities management, real estate in- vestment and capital market services, due diligence, global supply chain and logistics con- sulting and related advisory services.
hanks to a combina- tion of low vacancy rates, increased barri-
ers to entry, demand by occupiers and the institu- tional capital community’s ever-increas- ing appetite for industri- al produc t ,
time and money by provid- ing innovative solutions, and maintaining clear and open lines of communication to ensure the project’s success. Keystruct translates the cli- ent’s goals and objectives into a detail-centric construction strategy, so our clients can be DuPont has committed to invest $45 million in the new facility, which will increase its manufacturing capacity for DuPont Kalrez, a spe- cialized engineered material March 1991 to March of 2001. People in our industry ask us all the time, how long will it last? Some use the baseball metaphor that we are already in extra innings, yet by most accounts the economy still has room to grow. Of course there are threats to growth, such as wage in- flation, lack of a robust and qualified labor supply, rising interest rates and the flatten- ing of the yield curve. From our view, however, the prop- erty markets remain healthy, led by industrial, multifamily and self-storage sectors. At the NAI Leadership Sum- mit in Philadelphia we hosted at the end of March, Green Street Advisors Managing Partner Andy McCulloch stat- ed that asset values for indus- trial properties had increased 11% in the recent year, while manufactured homes were up 10% and apartments by 4%. Storage was off slightly, by minus 0.1%, but judging by the sales volumes we are see- ing from NAI specialists that focus on the self-storage real Newark, DE — CBRE represented DuPont Trans- portation & Advanced Poly- mers (DuPont), a DowDu- Pont Specialty Products Divi- sion business, and arranged the acquisition of a 120,000 s/f industrial facility located at 322 Ruthar Dr. in Newark, DE.
Eastern Pennsylvania’s In- dustrial markets continue to thrive. Although the specific submarkets have unique nu- ances associated with local economic drivers, highway networks, taxation, labor base, and other issues, the overall demand by tenants and capital community alike is driven by elementary economic rules of supply and demand met by sup- ply chain demand drivers. As the worldwide population each year buys a greater percentage of its goods online, this geogra- phy offers a unique ability to reach almost half of the U.S. population within a one-day truck drive, and a one-day or two-day delivery service from the two major parcel delivery providers: UPS and FedEx. Four Submarkets Technically, this thriving Eastern Pennsylvania market is comprised of four distinct submarkets: the Lehigh Val- ley, Northeastern, Central and Southeastern Pennsylvania. Their areas may be broken down as follows: the Lehigh Valley is the general vicinity of Easton through Bethlehem and Allentown and along I-78 past Hamburg. The Central Penn- sylvania region encompasses Harrisburg, York, Carlisle, Chambersburg, Greencastle and Lancaster. Northeastern In the facility design, five Easi-Set Buildings were erect- ed within the manufactur- ing structure to house the supervisor offices, restrooms, breakroom, storage and elec- trical rooms. The five build- ings were erected in two days using a forklift with a boom attachment. Each custom- sized Easi-Set Building has a different finish, including: Easi-Brick imprint, simulated CMU, simulated split face CMU, rubbed and vertical rib. “When customers visit us to constructed to accommodate future expansion.
PA Pangea map
Pennsylvania is the combina- tion of MSAs that include Potts- ville, Hazleton, Wilkes-Barre and Scranton. Southeastern PA is the five county suburban Philadelphia market including the city of Philadelphia. Cushman & Wakefield’s research indicates an overall sub-5 percent vacancy rate within the Eastern Pennsylva- nia Industrial markets, driven in part by the 4.8 million s/f of absorption in the first quarter of 2018 in the PA I-81 and I-78 industrial market, more than double the 2.3 million s/f of absorption at the same point last year. While there is a variance from each market to the next, they are minor and may be attributed to a single large vacancy in some cases, or recent delivery of multiple spec developments in others. Overall, however, these mar- kets are more similar now than ever before thanks to supply vs. demand balance, strong ap- petite by capital, and increased barriers to entry. These com- bined factors have resulted in increased sale values, but we expect that trend to continue given the lack of oversupply see our capabilities, they also can explore finished products and compare the styles, fin- ishes and options for Easi- Set Buildings,” Boyer says. “Beyond sales assistance, we selected Easi-Set Buildings because they provide a much higher level of protection for our most valuable resources, specifically our employees, during major storms.” The headquarters is located in a separate 40’ x 100’ x 12’ Easi-Span Building that has two finishes—the lower por- tion is Florida Ashler stone, and the upper portion is verti- cal rib. All the concrete build-
as seen in previous cycles. For example, asking rents in the I-81 and I-78 industrial market are projected to increase by over three percent by year-end 2018. Unique characteristics, but common attraction The submarkets may re- semble each other statistically, but they are also similar in ways that provide equally vi- able options for new occupiers who seek to open facilities in Pennsylvania. As a member of a 12-person brokerage team covering this market it is not uncommon to receive requests from investors or tenants to see the “important pockets of activity” in a single day. Without the use of a helicopter, it is practically impossible to currently see all of the action throughout these active sub- markets. In today’s market, it is more critical than ever to see all areas of Eastern Pennsylvania in order to fully comprehend the important dynamics at work. Gerry Blinebury is ex- ecutive managing director at Cushman & Wakefield Harrisburg, PA. ings are natural gray, un- stained concrete. Easi-Span Buildings are the largest clear span all-concrete building system and the only expand- able concrete building system on the market. Because of the post-tensioned and pre- stressed roof and floor system, Easi-Span Buildings can be in- stalled in hours depending on their size and site conditions. The prefabricated assembly creates a durable structure that is resistant to weather, temperature, impact and seis- mic activity. This 4,000 s/f building installation took only four days.
CBRE represents Dupont Transportation & Advanced Polymers in industrial acquisition
continued from page 11C Lonestar builds headquarters and Plant, featuring Easi-Set . . .
continued from page 2C Keystruct Construction, Inc. – Built . . .
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