Industrial markets had been booming across the Midwest long before the start of the COVID-19 pandemic. And since COVID began dominating headlines? The pandemic has only boosted the demand for warehouse and distribution space.
This isn’t surprising. Since the start of the pandemic, consumers have turned even more frequently to the Internet for everything from exercise equipment and outdoor toys to groceries and cooking supplies.
And all that stuff? It has to be shipped. Companies, then, are leasing space in distribution centers, building new warehouses and tweaking their supply chains at an even greater pace than they were before COVID-19 turned life upside down in the United States.
Consider just one market, Columbus, Ohio. Lee & Associates recently released its first quarter 2021 industrial report for this market. And the report — again, not surprisingly — is filled with good news.
According to the report, the Columbus industrial market saw record-setting net absorption in the first quarter of this year, with 5.02 million square feet of industrial space being absorbed.
Vacancy rates fell, too. Lee & Associates reported that the overall industrial vacancy rate for the Columbus industrial market fell to 4.9 percent during the first quarter. That’s down from 5.9 percent in the fourth quarter of 2020.
Developers are eager to tap into this strong market. That explains why 6.63 million square feet of industrial space is currently under construction in the Columbus area. That’s a high number, though it is a slight drop from the 7.38 million square feet under construction in the fourth quarter of last year.
Those construction figures include 3.78 million square feet of spec construction, indicative of just how much faith developers have in this market.
According to Lee & Associates’ report, some of the more active sellers in the first quarter included DHL, Avistone, VanTrust and Pizzuti. LBA Realty, Sarofim RE Advisors, Equity Industrial Partners, American National Insurance, WP Carey and Cardinal Industrial led the acquisition side during the quarter.
Two speculative projects each totaling more than 800,000 square feet, developed by Hillwood and Exeter in Madison County, were leased to Honeywell and Joann Fabrics. That continued to boost the strengt of the West Jefferson area along Interstate-70.
Tenants such as American Nitrile and Horton Emergency Vehicles absorbed space in the Southwest market, while PepsiCo, NFI, Huckberry and Bleckmann took industrial space in the Southeast submarket.
