Tuesday, June 2, 2020
Warehouse Leasing Picks Up as Consumers and Businesses Begin Spending Again
Industrial leasing is increasing as more states gradually reopen their economies from coronavirus-related closings and businesses get more comfortable committing to warehouse space.
Demand began slowing in mid-March, and CoStar logged some of the lowest levels of activity in history in April as skyrocketing numbers of Americans filed unemployment insurance claims, which totaled more than 40 million as of May 28. But consumers’ attitudes toward spending, which indirectly influence demand for logistics and distribution buildings, have begun to improve, CoStar managing director and senior economist Abby Corbett said in a new state of the market video.
Warehouse lease deals have gradually increased since the middle of April, and during the week that concluded May 23, more than 500 new leases were signed totaling nearly 13 million square feet, which is in line with the average weekly dealmaking collected throughout 2019, Corbett said.
Once again, e-commerce, medical, pharmaceutical and logistics operators such BMS Logistics led the charge. Amazon, among the most prolific users of industrial space before and during the coronavirus pandemic, signed a massive deal for 2.85 million square feet in Erlanger, Kentucky, near Cincinnati-Northern Kentucky International Airport.
Atlanta-based furniture store chain Haverty Furniture Companies Inc. raised $70 million by selling warehouses in Florida, Texas and Virginia. Havertys agreed to remain the tenant, and CoStar expects to see more sale-leaseback transactions as distressed retailers such as department store chain J.C. Penney look for ways to increase liquidity and pay their bills, Corbett said.
Meanwhile, CoStar has detected a major shift in construction from industrial projects built for specific tenants to warehouses built on speculation without signed tenants, Corbett said. Some industrial hubs such as Philadelphia and Pennsylvania's Lehigh Valley are seeing some problems with leasing up of new buildings.
"Tenants looking for modern space have far more options than they did just two or three years ago," Corbett said. "Over 600,000 square feet of space with 30-foot clear heights is now available, compared to just 400,000 square feet in 2018."
Video: ow.ly/lIRk50zWFwd
Friday, May 29, 2020
Thursday, May 28, 2020
AAMCO Plans to Expand Throughout the US
Car-repair giant AAMCO Transmissions and Total Car Care has new push to expand its network of AAMCO franchises in the US.
AAMCO, based in Philadelphia, has more than 600 franchises in the US and Canada. AAMCO’s chief strategy officer, Brian O’Donnell, said the company aims to “accelerate growth in targeted US markets.”
AAMCO is targeting suburban locations with between 3,000 and 5,500 square feet of space. It added that the optimal site for a new AAMCO location would be 4,500 square feet in either a stand-alone store or as the “end-cap” store at the far end of a shopping center or strip center—and in a high-traffic location with parking for more than 10 cars and with easy access to major roads.
“The current market conditions have demonstrated the essential nature of automotive service companies such as AAMCO, making them a highly attractive tenant for property owners in challenging economic times."
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