Same Day Speed | The Rise of Light Industrial in the Supply Chain

Rapidly evolving consumer demands have made it a priority for e-commerce retailers to provide same-day delivery service. This service has been implemented in select cities—mainly the nation’s largest metropolitan areas by population—but over the next several years it is likely to be offered in most markets across the country.

Distribution and fulfilment supply chains, which have traditionally been designed for two- to three-day coverage of the country and multiple daily delivery times, are being transformed to accommodate these short delivery promises. Gaining access to densely populated areas—in particular, to the e-commerce shoppers who live in those areas—is a priority.

Light-industrial properties—typically smaller than 200,000 sq. ft. and often located in or adjacent to infill urban markets—have been identified as the solution to the “last-mile” problem.

Light-industrial properties, initially out of favor in the early part of the current real estate cycle, are now in demand and have seen a rapid decline in availability and rise in asking rents relative to the overall market.

The CBRE Light Industrial Owner vs. Occupier Analysis, a study of light-industrial market dynamics in 15 major metropolitan areas, shows that the current landscape is favorable to owners and developers but that there remain several markets around the country with ample light-industrial space availability...

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