June 19 2024 0Comment

NAIOP I.CON East 2024 Highlights

Posted by Alston Construction In Alexandria, VA, Allentown, PA, Atlanta, GA, Boston, MA, Chicago, IL, Columbus, OH, Edison, NJ, Memphis, TN, Middleton, NY, Nashville, TN, News, South Florida, FL

Alston was a proud sponsor of the 2024 NAIOP I.CON East show in New Jersey, and it was a record setting crowd of more than 1,200 of commercial real estate’s top industrial owners, developers, investors and more. Beyond the optimistic outlook for the next 3-5 years in the Eastern United States for the industrial sector. Here are some other key takeaways we heard from the show:

Cold Storage Demand:

  • Cold storage is in higher demand, yet there’s a significant lack of existing inventory.
  • Traditionally located outside major urban areas, cold storage buildings are now being considered on a speculative basis despite higher costs of reworking the building for a specific need.
  • Only 2% of the industrial in the U.S. is cold storage, and half of it is outdated with obsolete technology and systems.
  • The existing buildings are often in less strategic locations as demographics have shifted over the past 30 years.
  • There is a growing need for cold storage in port areas due to the influx of global products.
    • Congrats to the winner of the PXG Golf Irons, Dan Ringel of Cushman Wakefield!

    Growing Demand for AI, Data Centers, Manufacturing, and Automation:

  • These sectors continue to grow in demand and seems they will continue to grow in demand.
  • They require increasing amounts of power, and delivering this power often has a long lead time, with new substations potentially taking up to 5 years to establish.
  • The need for electrical capacity is increasing. Power companies are reticent to make higher loads available right away for new builds that do not initially have the demand. (i.e., unknown future electrified vehicle fleets/automation requirements)

    • Project Delays and Developer Caution:

  • Designers are conducting extensive due diligence, drawings, and soil analyses, but many projects have yet to start.
  • Developers and financial institutions are adopting a wait-and-see approach due to fluctuating interest rates.
  • Despite high land costs, developers have asked General Contractors to look at Value Engineering options for projects currently on hold.
  • There is optimism that by late Q3 or early Q4, some of these projects will move forward.

    • In response to these emerging trends, Alston Construction has recently established a dedicated cold storage team. This specialized team is equipped with extensive experience in cold storage and refrigeration construction, ensuring that we can meet the growing demand for emerging cold storage facilities. By leveraging our expertise, we aim to support the evolving needs of the industrial sector and help our clients navigate the challenges of this rapidly expanding market.

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