By C&W Research
In both the short and long term, small-to-medium sized Multitenant Distribution Warehouse (typically 200,000 square feet or smaller) has been among the best performing of all commercial real estate segments in terms of rent growth and occupancy thereby making it an intriguing investment option.
- It makes up the largest share of U.S. industrial inventory (40%), and comprises an even greater share of the U.S. industrial investment-grade inventory (61.5%)
- Demand fundamentals benefit from e-commerce users who require it to support tighter delivery commitments
- Infill-related supply constraints hinder construction and ease competition for tenants, a favorably dynamic for owners
- At year-end 2015, it boasted the highest year-over-year rent growth of any property type at 6.5%
- In 2015, it achieved a 5.3% income return and a 9.3% appreciation return for a total return of 14.6%, well ahead of the overall industrial market
- On a one-, five-, and 10-year basis, it has outperformed the broader commercial property market
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