U.S. industrial real estate markets began 2010 much like they finished 2009: poorly. Demand for warehouse space remained elusive for most markets as warehouse users wanted further evidence the economy was on a sustained growth path before committing to new premises. Rents fell again and continued a nine quarter-long series of declines. Even though the economy registered relatively robust growth in the first quarter and further expansion is expected in the coming quarters, U.S. warehouse markets are unlikely to stage any vigorous bounce back until year-end at the earliest. Even though the Institute for Supply Management (ISM) manufacturing index posted a ninth consecutive reading above the critical “50” level (April – 60.4), businesses remained somewhat hesitant to commit to expansion even if orders are on the rise and profits are increasing. For the next few quarters a further increase in vacancy is anticipated, although at a much reduced rate with vacancies plateauing as early as the third or fourth quarters.

To view the entire article please Click Here

Responses are currently closed.