The Omaha industrial market entered 2020 on a hot streak, heading into January with a low vacancy rate of 3.3 percent. And Omaha-based Investors Realty said that throughout the first quarter of this year, the city’s industrial market showed no signs of a slowdown.
That might change now with the COVID-19 pandemic upending the U.S. economy. But as the 2019 Industrial Market Report from Investors Realty shows, Omaha’s industrial market has been booming for more than seven years. If any sector was poised to remain resilient in the face of the coronavirus pandemic? It’s this one.
As the report, authored by Investors’ Kevin Stratman, says, the vacancy rate in the Omaha industrial market has remained below 4 percent since 2013. Construction remains robust, too, with more than 1 million square feet of new industrial product coming online in 2019.
If you’re looking for more good news? The average asking rent in the Omaha industrial market continues to increase, too, and is now almost $6 a square foot.
As Kevin Stratman, the Investors Realty pro who authored the report, writes, during the last 25 years, Omaha has seen almost 20 newly-platted industrial parks larger than 30 acres in the Omaha metropolitan area. Most of these have risen in the Papillion/La Vista Sarpy county area.
Several big companies have also found homes along the Highway 50 corridor south of Highway 370. Travelers Insurance, Google and Facebook all have major investments along the corridor in the form of data centers. These projects account for almost 750 acres of new development.
Where will the industrial market head now, though, as these areas begin to fill up? Stratman, in his report, looks at several potential areas.
There’s the Bellevue market, where hundreds of acres of potential industrial sites lie south of Offutt Air Force Base along Highway 75. This area is close to the population centers of Des Moines and Kansas City, and could eliminate a significant amount of semi-truck travel time.
Council Bluffs, Iowa, has potential, too. The Interstate-80 and Interstate-29 expansions now underway could make this area more attractive to industrial users.
Gretna has seen two industrial parks platted in the last few years. Gretna Staton sold out quickly, while NT Industrial Park has seen a significant amount of new construction. Service providers have traditionally focused on Gretna. As Stratman writes, it remains to be seen which large user will jump into becoming the first big-gox distributor to set up shop in Gretna.
Then there’s the Highway 133 market, which was once thought to be the future of the local industrial market. Unfortunately for this market, the population of Omaha started to grow southwest, and brought industrial growth it. The city of Omaha’s master plan, though, has slated hundreds of acres for industrial use. Why haven’t industrial users flocked to this corridor? Stratman points to the topography here, which is challenging for development. How can developers develop this land in a cost-effective manner?
Stratman’s conclusion? That a combination of all these corridors, along with infill development, will continue to fuel the industrial market in Omaha.
