What is driving rent growth in the Industrial real estate sector?
- The use of automation and robotics is prevalent in modern warehouses for tasks like picking, packing, and sorting. However, many older warehouses lack the infrastructure to support automated storage and retrieval systems, conveyors, and advanced management software.
- Surprisingly, only 29% of industrial warehouses in the US were built after 2000, with much of the existing warehouse stock dating back to before 1970. Outdated designs, such as concrete flooring that is incompatible with modern robots, and limited capabilities (lack of space and power) of these older warehouses make them obsolete by many of today's standards.
- We expect this to lead to increased demand for cutting-edge logistics centers that can meet the needs of modern industrial tenants.
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