{"id":1004167770,"date":"2017-03-01T11:01:46","date_gmt":"2017-03-01T19:01:46","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004167770"},"modified":"2022-12-09T01:11:03","modified_gmt":"2022-12-09T09:11:03","slug":"multi-tenant-infill-industrial-the-unicorn-of-cre-investment","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/multi-tenant-infill-industrial-the-unicorn-of-cre-investment\/","title":{"rendered":"Multi-Tenant Infill Industrial: Unicorn of CRE Investment?"},"content":{"rendered":"<p><em>By Don Ankeny, President &amp; CEO,\u00a0Westcore Properties<\/em><\/p>\n<p><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg\"><img loading=\"lazy\" decoding=\"async\" data-attachment-id=\"1004167775\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/multi-tenant-infill-industrial-the-unicorn-of-cre-investment\/don-ankeny-r\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg\" data-orig-size=\"801,616\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;Brent Haywood Photography&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"Don Ankeny-r\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg?w=801\" class=\"alignright size-medium wp-image-1004167775\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg\" alt=\"Don Ankeny-r\" width=\"300\" height=\"231\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg 801w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg?resize=300,231 300w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg?resize=768,591 768w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a>Getting caught up in the thrill of the chase can sink an investor in the long run, when what seemed like the golden ticket ends up revealing hidden surprises. A savvy investor will counteract that urge by relying on careful study, specific market knowledge and proven relationships.<\/p>\n<p>Multi-tenant industrial real estate is hot, especially in metropolitan infill markets. Yet, while the product type is enjoying the limelight, not all properties are worth the chase.<\/p>\n<p>Demand is especially high for multi-tenant industrial partly due to the rise of e-commerce and last-mile delivery. Additionally, some retailers are trading storefronts for industrial space as they transition their businesses to wholly or partially online. Investors also benefit from low turnover costs since most suites are already built out, and industrial tenants tend to stay in place longer than with other product types.<\/p>\n<p>Furthermore, many of these metropolitan infill areas have limited land availability or land costs are too high to justify building industrial product. Further limiting the supply is conversions of industrial space to creative office, education or other uses.<\/p>\n<p>In this environment, investors are settling for smaller deals, as aggregating large portfolios has become difficult.<\/p>\n<p>Our firm has invested in major metropolitan cities throughout the Western U.S., and our broker partners agree that this is one of the tightest industrial markets they\u2019ve seen in a long time. Mark Demetre, managing director with JLL in Sacramento, said\u00a0\u201cthe inventory was picked through over the last few months, and as the market improved, values went up.\u201d<\/p>\n<p>Similarly, Bryce Aberg, executive director at Cushman &amp; Wakefield in San Diego, said multi-tenant industrial is the most sought-after product type in his market, and that \u201cit\u2019s very difficult to find product in any submarket in San Diego due to high demand.\u201d<\/p>\n<p>Tyler Carner, senior vice president at CBRE, sees the same in Denver, saying \u201cthe supply of multi-tenant industrial product for sale in Denver is very low, especially distribution product.\u201d<\/p>\n<p>In Sacramento, San Diego and Denver, these brokers say the suite sizes tenants in their markets prefer range from 10,000 to 25,000 square feet, 5,000 to 10,000 square feet and 20,000 to 50,000 square feet, respectively. Notice a big range? Knowing your market, the tenants in that market and establishing close ties with top-notch brokers are essential tasks when acquiring a property that can stand out from the crowd.<\/p>\n<p>And stand out, it must. \u201cMake your space non-commodity,\u201d says Aberg. \u201cTake it out of the generic, and brand your project.\u201d<\/p>\n<p>Another strategy tip? \u201cLook for generational opportunities now\u2014families who want to change or cash out,\u201d suggests Demetre. \u201cYou\u2019ve got to be ready so that you can tie up the asset quickly.\u201d<\/p>\n<p>Once an investor has studied the market, leveraged its broker relationships, inspected the property and closed on a truly valuable asset, its\u00a0only just begun. As Aberg stressed, a lack of proper maintenance, upgrades or\u00a0happy tenants, can make generating revenue and even selling the asset very difficult. Barriers to entry for ground-up construction yields room for rent growth, but not if your tenants aren\u2019t properly served.<\/p>\n<p>Finally, for investors looking to sell multi-tenant industrial in the foreseeable future, \u201csellers need to watch interest rates, as this movement will eventually bring a slowing to the capitalization rate compression that we have experienced for several years,\u201d advised Carner.<\/p>\n<p>So, is multi-tenant industrial property a unicorn? Perhaps, but certainly not without the right team. It\u2019s no coincidence that this article is a team effort. Our team is our success.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Don Ankeny, President &amp; CEO, Westcore Properties: While this product type is enjoying the limelight, potential investors need market knowledge and proven relationships to succeed.<\/p>\n","protected":false},"author":1043,"featured_media":1004167775,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[23891,21684],"tags":[34163],"class_list":["post-1004167770","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-national","category-viewpoint","tag-westcore-properties"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Multi-Tenant Infill Industrial: Unicorn of CRE Investment? - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/multi-tenant-infill-industrial-the-unicorn-of-cre-investment\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Multi-Tenant Infill Industrial: Unicorn of CRE Investment?\" \/>\n<meta property=\"og:description\" content=\"By Don Ankeny, President &amp; CEO, Westcore Properties: While this product type is enjoying the limelight, potential investors need market knowledge and proven relationships to succeed.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/multi-tenant-infill-industrial-the-unicorn-of-cre-investment\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2017-03-01T19:01:46+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-12-09T09:11:03+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/02\/Don-Ankeny-r-e1488299348825.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"801\" \/>\n\t<meta property=\"og:image:height\" content=\"616\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Don Ankeny\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/multi-tenant-infill-industrial-the-unicorn-of-cre-investment\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/multi-tenant-infill-industrial-the-unicorn-of-cre-investment\/\",\"name\":\"Multi-Tenant Infill Industrial: Unicorn of CRE Investment? 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