Page 14 - RENJ Aug2021

12 AUGUST 2021
Demand continues to surge in top industrial real estate markets, with little sign of slowing down,
but it’s not just for space inside the four walls.
According to brokers and landlords, parking requirements have soared alongside tenants’ search for warehouse and distribution facilities. The growing demand — which is often tied to the use of large delivery fleets in northern New Jersey and other population centers — is now spurring changes in building design and creating new revenue streams for industrial owners, while adding to an already insatiable appetite from investors.
“You’re seeing that more in the true last-mile, infill locations, because
it’s all about turns and getting the products (to customers),” said Jeff
by logistics, delivery and traditional retail companies.
“With parking, it’s no longer ‘By the way, we need
it,’ ” said David
Knee, a vice
firm also pointed to leasing volume for parking space in the region since the start of 2020, which equates to double the acreage leased from 2018 through 2019.
Industrial owners are capitalizing on that demand by charging for anything deemed to be above standard parking at their buildings — typically, one car space per 1,200 to 1,500 square feet of warehouse area and one trailer spot per dock door.
“Historically, that was always a New York City thing,” Milanaik said. “You can actually charge rent if you have a user that has that demand.”
The requirements are also now factoring into building design, Knee said, as developers consider structures
CHASING SPACES
Industrial owners adapting, unlocking new revenue streams as parking requirements soar
By Joshua Burd
Jeff Milanaik
Milanaik, Bridge Industrial’s Northeast region partner, noting that parking needs are especially intense at e-commerce delivery centers,
chairman and
broker lead
for JLL’s three-
state Northeast
industrial
region, which
is based in East
Rutherford. “It’s at the forefront of the requirement.”
With land increasingly hard to come by in North Jersey, parking rents in locations such as Newark are some 50 percent higher than they were in 2019, according to JLL research. The
which typically feature smaller warehouses served by large numbers of vans and box trucks. “That’s where you’re going to see continued demand for fleet parking.”
The trend has emerged over the last two to three years, experts say, fueled first by Amazon and now increasingly
David Knee
Demand for parking in and around industrial properties has soared in New Jersey, fueled largely by the use of large delivery fleets, spurring changes in building design and creating new revenue streams for industrial owners.