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The Amazon Effect: Warehouse Rents Shot Up In 2015


The e-commerce boom is pushing up demand for US warehouse space, leading to rent growth in the sector.

Rents for prime US warehouse space rose 9.9% in 2015 compared to just 2.8% worldwide, according to CBRE, as retailers and distributors grabbed facilities near import hubs and population centers.

Six US markets were in the top nine worldwide for rent growth, with Oakland seeing the fastest spike, at 29.8% year-over-year—almost twice the rate of the white-hot northern NJ market, the Wall Street Journal reports.

CBRE’s head of Americas industrial and logistics research, David Egan, says new construction can’t keep up with the demand boom fueled by e-commerce, and he expects the supply gap to continue, pushing rents in top markets up another 6%.

“There are huge premiums being placed right now on being close to the consumer,” David tells the Wall Street Journal. “Speed of service, speed of delivery, is a critical component of why people choose to buy from one retailer over another.” [WSJ]