Special Advertising Section to The Journal of Commerce
PHOTO: AMB Property Corp.
Many industrial real estate projects are moving forward via innovative thinking and strategies that bring more value to the table.
Into the Headwind
Industrial Real Estate Moves Forward
By Lori Musser
Facing a major economic headwind, industrial real estate
continues to move forward. Some companies are
vigorously pursuing the industries that, even in this down
cycle, can utilize the available space on the market. Others are
realigning their services to go beyond meeting basic customer
needs, developing innovative value-added products to help the
industry gear up for a leaner, healthier future.
While the market may have shaped the current state of industri-
al real estate in the United States, an upswing in the market alone
will ensure survival or prosperity for all companies. Innovative
thinking is bringing more to the table and those organizations that
identified, sold and delivered opportunities for added value will be
the ones to re-emerge.
Now is the time for corporate America to rethink the size, loca-
tion and features of industrial properties. Do they complement the
company’s operational requirements, environmental commitments,
safety concerns, corporate philosophy and bottom line?
Jim Dieter, executive managing director of industrial services of
the Americas for commercial real estate services heavyweight CB
Richard Ellis, said, “This downturn will drive better quality and, ulti-
mately, more productivity.” As companies closely scrutinize their
expense items, they will pinpoint efficiencies and deficiencies in
their real estate holdings, disposing of unproductive operations.
Some regions and industry types generally do well on the
down cycle. The food industry, traditional and renewable energy
and third-party logistics providers are all absorbing space today,
Dieter said. Echoing Dieter, Trammell Crow’s Tampa-based manag-
ing director Bob Abberger said, “This is a great opportunity to
move into a better class of product.” Discussing Trammell Crow’s
commitment to sustainability and Leadership in Energy and
Environmental Design status, Abberger said, “Going forward
everything will be LEED certified if possible. There will be dramatic
improvements and overall, there will be a larger chasm between
new Class A and older, less efficient buildings.”
Gene Reilly is president of the Americas for AMB Property Corp.,
which owns, operates and develops distribution facilities in markets
throughout the Americas, Europe and Asia. The competitive land-
scape, from the real estate side, has improved. Land prices and con-
struction costs have fallen,” he said. Companies are relocating, build-
ing or consolidating facilities near population centers. “These loca-
tions, called in-fill sites, are holding their own. The trend to build dis-
tribution centers on inexpensive land in unconstrained locations has
eroded. The primary markets with populations and gateway markets
with ports and airports will outpace secondary and tertiary markets.”
In recent months industry executives have been fairly quiet
about the West Coast industrial real estate market.
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