As demand for industrial real estate continues to grow, Jim Connor, chairman and CEO of Duke Realty, sees no indication the market will slow down any time soon. In an interview with National Real Estate Investor, Jim discusses Duke Realty’s outlook and plans for the future.
“We keep predicting every year that supply is finally going to catch up with demand, and it still hasn’t happened yet,” said Connor. “Based on activity, I don’t see that trend changing. Our in-service portfolio is 97.5 percent leased (as of the first quarter of 2018), and with that you get great, strong rent growth numbers.”
Earlier this year, Duke Realty revised its forecast for development starts in 2018 from $500-700 million to $650-800 million. This includes development in New Jersey, South Florida, Southern California, Dallas, Chicago, Atlanta, and other target markets.
One of the biggest factors contributing to the increased need for industrial real estate is the rapidly growing e-commerce sector. Companies such as Amazon, Wayfair, and other e-commerce giants have contributed to an industrial REIT boom, and Duke Realty is poised to take advantage of this growth by strategically expanding its industrial real estate portfolio.
“E-commerce continues to be a big, big driver in our business,” said Connor. “Those guys are not slowing down. Our traditional customers—retail and consumer products companies—are investing in their supply chains to get products to their customers more quickly and more efficiently. The logistics sector looks very, very bright for the next several years.”
To learn more about Jim Connor’s impressions of where the industrial real estate market is headed—and Duke Realty’s plans for the future—check out the full interview here.