Major Industrial Developers Once Again Sharpening Their Pencils

Two years ago at our annual Northern California SIOR Chapter event at the San Francisco Ferry Building, where major industrial developers forecast what they think this industry segment will be doing over the next year…I remember a consistent comments that their pencils were put away and that new Bay Area industrial development for the most part had paused. This was due to a number of factors, including the high cost of land and the very high cost of materials and labor. At yesterday’s annual meeting the mood was much different. I know to those in the Mid-west and elsewhere to hear of California industrial land prices being crazy-high, but apparently they briefly reached $100 per square foot and now have fallen back to $50-60/sf or less, and this is causing developer pencils to come back out and get sharpened…industrial rental rates are up, demand is still strong, so at least for this one market-segment the future looks much brighter than it has in past years!