In recent times, the demand for modern distribution facilities have been getting a significant boost as the companies are compelled to enhance and renovate their distribution, and production platforms to support the e-commerce business and address a large customer base. Services like same-day delivery are gaining traction and last-mile properties are witnessing a solid increase in asset values.
Duke Realty Corp.’s solid capacity to leverage on this favorable trend has helped it to achieve full occupancy across a number of its properties. Recently, this industrial real estate investment trust (REIT) announced that it completed the leasing of the third building at 33 Logistics Park in Lehigh Valley, PA.
Notably, the property’s strategic location worked on the company’s advantage and thus, Duke Realty could achieve 100% occupancy for this development, spanning 2.7 million square feet. The property is on the east of Lehigh Valley, with access to the highway. Also, it could be connected to I-78, I-81 and I-80 very easily.
33 Logistics Park has three buildings. Out of which, the other two got leased as soon as the construction was completed, one in early 2016 and another in July 2017. All the buildings have been leased by e-commerce and logistics companies.
Duke Realty has another spec industrial building under construction, Central Logistics Park 53, which is located at the west of Lehigh Valley. It is expected to be completed by July 2019.
On the other hand, Sysco Guest Supply and Genera Corporation have renewed leases in Illinois with Duke Realty. With this, the buildings occupied by them, enjoy full occupancy. Specifically, with the renewal, Sysco will continue occupying 93,880 square feet in Carol Stream 370, which is situated at 370 Kimberly Drive. Genera will also continue working from 4220 Meridian Parkway, which is a 192,600-square-foot building in Aurora.
Industrial REITs are sure to scale new heights, with a recovering economy and job market gains, as well as elevated consumption levels. Moreover, with a healthy manufacturing environment and high business inventories, the demand for warehouse and logistics real estate is anticipated to be high, giving significant impetus to industrial REITs like Duke Realty, Prologis Inc. and Liberty Property Trust to flourish.
Per a study by the commercial real estate services firm, in first-quarter 2018, availability fell for 31 straight quarters to 7.3% for the U.S. industrial market. Moreover, with demand surpassing new supply, net asking rents moved up 1.9% in Q1 to $7.01 per square foot, denoting the highest level since 1989.
Moreover, it should be noted that Duke Realty has resorted to the sale of sub-urban office assets and medical-office buildings in the past to transform itself into a domestic-focused industrial property REIT. This augurs well amid the favorable market environment in this asset class.
www.omegare.com
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