Mega-Warehouse Demand Continues in Central Iowa
According to a new report, warehouse users signed leases for 37 facilities of 1 million sq. ft. or larger in the U.S. in the first half of 2022. The activity points to expansion in the industry, particularly for traditional retailers and wholesalers. In Central Iowa, warehouse leasing was active in the third quarter of 2022 including twelve industrial properties sold during the quarter.
Eighty-five of the top 100 leases are new leases rather than renewals. Traditional retailers and wholesalers accounted for the largest share – 40 leases. Runner up: Third-party logistics firms at 30 leases.
The markets in which the largest 100 leases occurred are a mix of industrial & logistics mainstays like Atlanta, Chicago, and California’s Inland Empire, and a few that don’t always see a very large volume of activity, such as Indianapolis, Savannah, Ga., and California’s Central Valley.
Locally, nearly 3 million square feet of industrial space is under construction with an estimated 1.2 million square feet of speculative warehouse construction expected to be completed during the fourth quarter. Warehouse demand continues with large requirement users looking for space in Central Iowa.
The vacancy rate for industrial space in the Des Moines area is 2.9% and the average direct asking rent rate is $6.09 per square foot. As land costs and construction costs increase, expect asking rents to gradually increase in step with development costs.
If leasing is on your mind, speak with our manufacturing business advisors.