E-commerce giants like Boston-based Wayfair, along with Amazon, Chewy and Walmart are competing for warehouse locations and last-mile distribution centers around the country. A recent analysis by CBRE projects that 330 million square feet of warehouse space must be added by 2025 to keep up with warehouse demand.
The Boston Metro is among the areas with high demand for warehouse space. Earlier this year, CBRE reported the Boston area as having the sixth-highest increase in warehouse rents in the U.S., averaging 14.8% higher on a year-over-year basis. Warehouse space in the Northeast averaged $8.32 per square foot in weighted asking rents during the 2nd quarter 2021. Only the Western area of the U.S. has higher warehouse demand, which is also reflected in higher trending rents of $10.39 a square foot.
There is a sizable amount of warehouse space in development across the nation. Yet with the costs of land acquisition and construction soaring, there has been a trend among e-commerce companies to tie up existing warehouse properties with long-term leases. Meanwhile, with low vacancy rates being the norm in the warehouse sector, rents will trend higher for the foreseeable future.
Small and mid-sized Boston Metro businesses in need of warehouse space should obtain professional tenant representation before beginning their search! When you are ready to begin, relocate or expand your business, team up with the Jay Nuss Realty Group, LLC! Whether you are thinking of buying, leasing, or investing in Boston Metro commercial real estate, we can help you find the ideal property.