Cold Storage is a Hot Commodity
As Chicagoland experiences growing demand for refrigerated facilities, investors flock to the space.
By John Basile | Executive Vice President | NAI Hiffman
Despite fears of slowdowns and oversupply due to the pandemic, the Chicago industrial sector proved resilient through first-quarter 2021 and surged in the second quarter as e-commerce propelled demand.
Charging food distribution and eating patterns drove more interest in cold storage by users and investors. Aging facilities, a lack of spec development and long lead times for new construction drove up prices when refrigerator or freezer facilities did come to market.
According to NAI Hiffman research, industrial vacancy in Chicagoland stood at 5.3 percent at mid-year, a decrease of 87 basis points from mid-year 2020, despite more than 6.5 million square feet of new product coming online. The Chicago area absorbed almost 9.7 million square feet at mid-year, the highest in nearly five years, with the lowest vacancy in Southwest Cook County at 2.9 percent.
At mid-year, 68 industrial developments were underway in the Chicagoland area totaling 27.3 million square feet. Eleven submarkets had at least 1.1 million square feet of development in progress each, led by almost 5.5 million square feet in the I-80/Joliet Corridor.
Read the full article online in the digital publication of Heartland Real Estate Business.