Orlando, Fla. --- Co-Star Group’s latest forecast sees big gains in speculative warehouse development in 2014… and that’s good news for George Livingston, chairman of Realvest Development in Orlando.
Ranked as one of Central Florida’s most active developers of commercial warehouse facilities in Central Florida, Realvest Development has liquidated much of its assets and is actively seeking specialized development opportunities.
“Co-Star Group forecasts that demand for quality warehouse and distribution space will outstrip supply in 2014,” Livingston said, especially Class A distribution space.
“Speculative development accounts for almost two-thirds of the 59 million square feet of warehouse and distribution space under way in the U.S. right now,” Livingston said.
“Warehouse vacancies dropped almost a full percent nationwide last year and should drop below the 8 percent mark by summer,” Livingston said. “At the same time fully stabilized properties are selling at about the same low cap rates we saw at the top of the cycle,” he added.
Among the economic forces spurring new warehouse development is obsolescence.
“Tenants want modern, efficient space and much of the vacant space on the market today is older, poorly designed by today’s standards and ill-equipped to adequately accommodate modern, technology-proficient operations,” Livingston said.
“Investors are seeking to buy well designed space in markets that have job and population growth and many areas are turning to new cluster designs that attract job creators. Those programs also accelerate demand for new space,” Livingston said.