There are massive, and I mean massive, warehouses being built all along the I81 corridor in Maryland & PA, The majority of these, if not all of them, are sitting empty and unrented but more keep getting built! The County Commissioners in Wash Co MD said they couldn't do anything to stop these companies from building and were sued when they tried to stop it. Does anyone know what's going on with all of these empty warehouses?
You're viewing a single comment thread. View all comments, or full comment thread.
Comments (37)
sorted by:
Build to suit buildings. Not that hard to figure out. Roughly 90% of Industrial Real Estate Developments are build to suit. Basically, they just build empty shells (Like what you and many others are describing), and then sell to them a property management company that specializes in industrial properties like Prologis (the largest industrial REIT in the world. Also the largest REIT in the world period), who then finds someone to rent it out to and finishes the building to their specifications.
Typically there's a few years between the initial building and the "finalization" of the project, as they have to take bids on the properties, let the prospective tenants tour the properties, then hire architects, engineers, etc. etc. to design the finalized building, then they have to actually build the last stages of the project, etc. etc.
Most of them are probably gonna end up as wholesale warehouses or distribution centers since that's the Big demand now given how much e-commerce has taken off in the last decade or so. Some may end up as data centers, manufacturing centers (like machining shops), etc. etc. Heck, there's even a chance some may end up as assembly plants for things like vehicle parts (like putting together brake rotor assemblies for Chevy for example) or other types of manufacturing.
The reason see so many of these types of projects near highways and major cities/metropolitan areas, is because of ease of access. Regardless of what it ends up as, its more convenient for the potential tenants if they have easy access to a major roadway to get materials, move product, etc. etc.
u/Prayingforus20 pointed out that they're building stuff like this all around Chicago. That's because Chicago is the absolute center for logistics in North America. It doesn't matter what you're shipping or how you're shipping it (train, truck, etc.), if it moves by land on the continent of North America, it ends up in Chicago at some point or another because of how the roads and railways are laid out.
So the Chicago market is particularly competitive and oversaturated, meaning a lot of projects go bankrupt there and have to sit in litigation for years as the banks settle out who actually owns what and try to find a buyer at their price so they minimize losses.