Bruce McConnell sees good news for the industrial market in 2014, in the Midwest and across the nation.
And he’s far from alone.
McConnell, associate director in the Chicago office of Studley, is one of the many real estate brokers across the region predicting big things for industrial in 2014. And these big things aren’t going to happen solely in Chicago. Several other markets — notably, Indianapolis and Louisville — are already in the middle of an explosion of spec industrial construction.
This is good news for the commercial real estate industry, and evidence that the commercial recovery will grow even stronger in 2014.
“The industrial market is really stabilizing,” McConnell told Midwest Real Estate News late last year. “It has been much now that it has been for the last few years. We are at historically good vacancies. There is also some new construction, some spec construction going on. That is a positive. When new construction is going on, that provides more options for our tenants.”
The news is especially good in Indianapolis, a city that is now seeing a boom in industrial construction, much of it the spec variety.
HSA Commercial, for instance, is developing in partnership with Great Point Investors a 220,000-square-foot spec industrial building in the Gateway Business Park in nearby Plainfield, Ind.
“The Indianapolis market is very active,” said HSA’s Robert Smietana, vice chairman and executive officer with the company, in late 2013.
He pointed to a vacancy rate in the area’s industrial market of 3 percent to 4 percent, something that “signals to most people that there is an under-supply in the marketplace.”
The hope from the commercial brokers that Midwest interviews? That the industrial boom will only pick up pace in 2014. And if that happens? Brokers are hoping for similar growth spurts in the Midwest’s retail and office markets.
