North America sees industrial property boom

The organisation’s Ports Airports and Global Infrastructure (PAGI) 2017 Seaport report said that port-centric submarkets across all cities have seen healthy growth and growing industrial property occupancy levels so far this year.

Of the 14 ports studied in the report, North America’s East Coast ports – Baltimore, Charleston, Houston, Jacksonville, Miami, New York/New Jersey, Savannah, Virginia and Montréal – have a slightly larger proportion of immediate market size, at 55%, than the West Coast ports studied.

The West Coast ports – Long Beach, Los Angeles, Oakland, Seattle-Tacoma and Vancouver – account for the remaining 45%.

According to the report, the majority of US containerised trade is still handled in the country’s “four corners” – the ports of New York/New Jersey, LA-Long Beach, Savannah and Seattle-Tacoma.

LA, Long Beach and Seattle-Tacoma have the highest occupancy rates compared with other ports and also have the most expensive rates for warehouses and distribution spaces, some at nearly $10 per square foot, triple net.

However, New York/New Jersey, Jacksonville, Oakland and Long Beach saw the biggest decline in vacancy rates at more than 2%.

Currently, in JLL PAGI markets, nearly 25.4m square feet of land is under construction – construction activity levels having doubled since 2015 – with nearly 65% of it being on US East and Gulf Coast ports.

However, in comparison to 2015, there has only been a minimal increase in the overall property footprint of the port submarkets.

To make room for functional property, some of the older buildings at ports at being demolished by port authorities. In recent years, the New York/New Jersey Port Authority has demolished over 2.9m square feet of land – a figure which accounts for almost 3% of the port submarket total inventory.