More housing construction means more demand for warehouses
It’s common sense: the more houses are ordered for construction, the greater the demand for building materials.
But while the manufacturer of these materials is fixed in one place, construction sites are all over the place.
Thus, there has been a growing need for warehouses all over the US.
More building permits
Warehouses cut the physical distance between demand and supply while keeping the materials safe from to the elements.
Whether a sign of sustained recovery in the housing sector or short-term fad, one thing is clear – the projected demand for light industrial space is supported by the 25.4% increase in building permits issued in May of this year.
Aside from new residential developments, home sales in general have also seen a significant and steady increase since April 2015.
Confidence in the industrial sector
This boost in sales has also inspired confidence in the industrial sector, where investors are being encouraged to look into the warehousing market.
Industrial property experts also expect furniture stores and home products retail chains to make a comeback – which, in turn, engenders a knock-on effect for more industrial materials that need to be warehoused.
These companies are yearning to recover from the losses incurred by e-commerce, which dethroned these businesses overnight by removing the “middleman warehouse” from the equation.
Investing in warehouses
With more housing developments sprouting all over the country, Home Depot and similar businesses—big and small—have rejoined the fray and will need more space to store the mountains of products they need to move faster and nearer the customer.
What experienced investors need now is the right location to set up their light industrial spaces. Once word gets out and new players decide to invest on this market, it would be harder to penetrate.
A word of caution: remember to keep very close tabs on developments in the industrial sector and its sub-markets before jumping in.
Need to know source warehouse locations in LA? Give Nordine Commercial a call at 310-379-8800.
