Everything is bigger in Texas so it’s no surprise the Dallas area is leading the way in industrial construction.
About 28 million square feet of warehouses and distribution centers across 81 projects in Dallas-Fort Worth are scheduled to be completed by year-end, according to a report from CommercialSearch, a CRE listings company. That puts the state’s third most-populous city far ahead in the recently published ranking, which tracked the top 20 markets with the most amount of industrial space set to be delivered.
In total, about 342 million square feet of industrial development is expected to be delivered across the U.S. this year, a remarkable 24 percent increase from last year, the report found. And also not surprisingly, Amazon has a part to play.
The Everything Store will lease 8 of the 10 largest projects on the list, the report found. That’s including a 4 million-square-foot logistics center in Colorado Springs, Colorado, which is tied with Tesla’s Gigafactory as the largest industrial project set for completion.
Phoenix was second with 18.4 million square feet of industrial space and Chicago, always a powerhouse in the category, was third with nearly 17 million square feet.
And Southern California’s Inland Empire, another industrial stronghold, was a close fourth with 16.3 million square feet. That metro region around Los Angeles, Riverside and San Bernardino counties has 104 individual projects set to be delivered, more than any other market in the nation.
In New Jersey, developers will complete just under 8 million square feet of industrial space this year.
The pandemic has boosted the need for e-commerce space, leading to a spike in industrial development and overall activity. Investors are eager to get in on the action. But big investors have had their eye on the sector for some time.
Blackstone Group has built up its industrial portfolio over the last several years from just 9 percent of its total holdings to 27 percent.
Tesla’s Gigafactory project, in Austin, Texas, meanwhile, accounts for 40 percent of the 10.3 million square feet of industrial space scheduled for completion in the city this year. Amazon also has a 3.8 million-square-foot facility under construction outside Austin.
Propelled by those two projects, Austin’s total expected deliveries is a five-fold increase over 2020, the most drastic of any major market. Dallas’ expected total, by comparison, would be just 2 percent above its amount last year.