Despite a significant increase to existing building stock in 2022, the national vacancy rate for industrial space in the U.S. fell below 4 percent.
At the end of last November, there were 742.3 million sf of industrial space under construction, representing 4 percent of total existing inventory, according to Commercial Edge’s National Industrial Report, which it released on December 21. Dallas and Phoenix are the two top construction markets for this sector. And nationwide, another 684.5 million sf of industrial space are in their planning stages.
However, new construction is barely keeping up with leasing demand, as the vacancy rate in the 30 largest industrial markets tracked by Commercial Edge stood at 3.8 percent at the end of November. The Report asserts that the biggest challenge for developers is finding suitable land in port markets like California’s Inland Empire, Los Angeles, and New Jersey. But even non-port markets like Nashville and Columbus, Ohio, are experiencing extremely low vacancy rates.
The top 30 markets, through November, recorded aggregate property sales of $78.8 billion. While sales have cooled a bit nationally, the average sales price of $116 per sf in the first two months of the fourth quarter was still nearly 18 percent higher than the same period in 2021.
![Commercial Edge's ranking of top industrial construction markets](/sites/default/files/inline-images/Screenshot%202022-12-21%20at%201.55.43%20PM.png)
A huge building for a tight New York market
With these market dynamics as a backdrop, the real estate investment and development firm Turnbridge Equities announced earlier this month the topping out of Bronx Logistics Center, the largest industrial development in New York City.
Nestled in the borough’s Hunts Point industrial area, this Class A 1.3-million-sf, multilevel complex on 14.2 acres (assembled from five properties) consists of 585,000 sf of total warehouse space with 32-ft ceiling heights and 40- by 40-ft column spacing, 730,000 sf of parking space (25 percent of which is electric-vehicle ready with charging stations), 48 loading docks, and 72 drive-in doors.
![A drone image of the Bronx Logistics Center under construction](/sites/default/files/inline-images/DJI_0523.jpg)
The building’s rooftop solar panels will generate three megawatts of energy. The site includes a CSX freight railway spur, providing tenants with potential direct rail access, and is located less than two miles from the Hunts Point Food Distribution Center, which generates over $3 billion of annual economic activity.
When it’s completed in the second quarter of 2023, the Bronx Logistics Center will serve the entire New York metropolitan area and beyond. It is a five-minute drive from Manhattan’s Upper West Side, and has convenient access to Interstates 95, 87, 295, and 278.
Arco Design/Build Industrial is the designer and general contractor on this project. “We provided a high level of risk mitigation for our client by locking in construction costs prior to going through all of the design documents,” Arco states on its website. Turnbridge Equities, which owns the building, and the project’s equity partner Dune Real Estate Partners, retained JLL as the leasing agent. (As of mid December, no tenants had committed to leasing space.)
While Turnbridge didn’t release the cost of this project, The Real Deal reported that Turnbridge paid $174 million to acquire the land in 2018 and more recently secured $381 million in construction financing and debt refinancing from KKR.
Once completed, the Bronx Logistics Center’s size will exceed the 1-million-sf industrial development of Innova Property Group and Square Mile Capital Management. The borough’s industrial inventory accounts for about 17 million sf of space. The Bronx Times reports that only 1.6 percent of New York City’s industrial space is available for lease.
Related Stories
| Oct 18, 2013
Researchers discover tension-fusing properties of metal
When a group of MIT researchers recently discovered that stress can cause metal alloy to fuse rather than break apart, they assumed it must be a mistake. It wasn't. The surprising finding could lead to self-healing materials that repair early damage before it has a chance to spread.
| Oct 7, 2013
10 award-winning metal building projects
The FDNY Fireboat Firehouse in New York and the Cirrus Logic Building in Austin, Texas, are among nine projects named winners of the 2013 Chairman’s Award by the Metal Construction Association for outstanding design and construction.
| Sep 24, 2013
8 grand green roofs (and walls)
A dramatic interior green wall at Drexel University and a massive, 4.4-acre vegetated roof at the Kauffman Performing Arts Center in Kansas City are among the projects honored in the 2013 Green Roof and Wall Awards of Excellence.
| Sep 19, 2013
What we can learn from the world’s greenest buildings
Renowned green building author, Jerry Yudelson, offers five valuable lessons for designers, contractors, and building owners, based on a study of 55 high-performance projects from around the world.
| Sep 19, 2013
6 emerging energy-management glazing technologies
Phase-change materials, electrochromic glass, and building-integrated PVs are among the breakthrough glazing technologies that are taking energy performance to a new level.
| Sep 19, 2013
Roof renovation tips: Making the choice between overlayment and tear-off
When embarking upon a roofing renovation project, one of the first decisions for the Building Team is whether to tear off and replace the existing roof or to overlay the new roof right on top of the old one. Roofing experts offer guidance on making this assessment.
| Sep 11, 2013
BUILDINGChicago eShow Daily – Day 3 coverage
Day 3 coverage of the BUILDINGChicago/Greening the Heartland conference and expo, taking place this week at the Holiday Inn Chicago Mart Plaza.
| Sep 10, 2013
BUILDINGChicago eShow Daily – Day 2 coverage
The BD+C editorial team brings you this real-time coverage of day 2 of the BUILDINGChicago/Greening the Heartland conference and expo taking place this week at the Holiday Inn Chicago Mart Plaza.
| Aug 30, 2013
Local Government Report [2013 Giants 300 Report]
Building Design+Construction's rankings of the nation's largest local government design and construction firms, as reported in the 2013 Giants 300 Report.
| Aug 30, 2013
State Government Report [2013 Giants 300 Report]
Stantec, Jacobs, PCL Construction among nation's top state government design and construction firms, according to BD+C's 2013 Giants 300 Report.