The average age of a U.S. warehouse is 34 years, a CBRE survey finds.
Many of them lack modern upgrades: ceilings are low, flooring is uneven and space is tight.
As Amazon and other retailers move sales online, demand for warehouse space is skyrocketing and supply is still limited.
The average age of a U.S. warehouse is 34 years, according to a survey by real estate services firm CBRE. And that likely won’t cut it for a retail industry that’s moving increasingly toward e-commerce and fulfilling online orders for customers in the blink of an eye.
In surveying facilities across 56 markets throughout the country, CBRE found most warehouses built before about 2005 lack modern upgrades: Ceilings are low, flooring is uneven and space is tight.
“We’ve seen an incredible shift in the way people use industrial real estate,” Adam Mullen, senior managing director of CBRE’s industrial and logistics team, told CNBC. “It’s gone from an out-of-the-way asset to a strategic weapon.”
Thus, “when folks use industrial real estate as a strategic weapon, they need more space, … taller space and more modernized space,” he said. Demand is skyrocketing for newer properties, while supply of younger buildings is still nascent. Industry experts say there’s much more construction to come.