A rise in spec construction has brought some breathing room to a tight industrial market in Milton and Halton Hills, according to a study released by Avison Young. The increased presence of multinationals and large domestic retailers—and the strengthening of the e-commerce sector in correlation to their need for large distribution centres—has been the impetus behind the surge in development activity. Milton, for example, has 19M SF of inventory and a 4.2% availability rate, which is expected to increase with Triovest’s new 406K SF facility at Chisholm Dr and Cooper Construction’s 303k SF facility on Peddie Rd adds new space to the market.
According to the report, Halton Hills’ availability rate has dropped to 3.9% (5.7M SF of inventory). Developers are increasingly facing an ultra-competitive environment for land, which has been driving up the cost for industrial development, resulting in narrow yields for new product, notes Avison Young principal Mark Sevenpifer. Along with the additional 1M SF of new product in Milton, another 105k SF of product is coming online this spring with KingSett Capital’s expansion at 35 Brownridge Road (image) in Halton Hills. If the current steady rate of absorption remains constant, the market will see a moderate increase in availability rates as the new product enters the market.
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