Optimism is Key

Industrial tenants are optimistic about expansion plans despite recent interest rate hikes and economic uncertainty.

The southeast is one region that is a hotspot for activity due to the lower cost of doing business, excellent interstate systems, and a pro business climate.

We just worked on an industrial search for a client looking for approx. 100,000 SF in the Newark, NJ area and we found that rental rates for a distribution facility ranged from $20-$30 per sq. ft. annually with $4-$5 per sq. ft. in NNN expenses. That is if you can even find a building that is available as the market is extremely tight.

In comparison, for the same product in the Greenville/Spartanburg area of SC we are seeing Class A industrial rents in the $5-$6.50 range with $1.25-$1.50 in NNN’s. That is a 4X to 5X increase in leasing costs alone to do business in Newark vs. the GSP area.

You can see why many companies are moving operations to the southeast!