We asked our 2009 Deal Maker Top Producers (based on 2008 production) to provide their thoughts about the market in 2009, and what is in store for 2010 and beyond.
Industrial Report
by Greg M. Copps, SIOR, Clarus Properties, Inc.
The most positive thing that I can say about 2009 is that it is over. The industrial market has been slammed by the worse recession since the Great Depression. Availability levels continue to rise, lending is non-existent and the housing market continues to suffer. Rental rates have declined, demand has decreased which in turn has led to a major reduction of property values.
Our market fundamentals have all trended in the wrong direction:
• Negative absorption;
• Increased vacancy;
• Decreasing rental rates; and
• Decreased overall property value.
The credit markets and the mounting federal debt are major concerns moving forward. Banks need to start lending but they also need to deal with their massive non-performing real estate loans. In order for a turn around, the housing market needs to rebound as well as consumers need to start spending. We need to see unemployment rates decline and the Charlotte Region to attract manufacturing and distribution jobs.
The positive aspect about the Charlotte Region is that we never became grossly overbuilt and remain a desirable place to relocate manufacturing and distribution operations. The upswing in the stock market, which is a leading indicator to real estate activity, has made owners and investors a bit more confident moving forward with projects in the region. Current government statistics point to economic growth; import and export activity can’t get any lower therefore, businesses should start to build inventories again.
When the turn around does occur Charlotte is well positioned for future prosperity and should out perform most comparable markets. Charlotte continues to be one of the fastest growing metropolitan areas in the nation that offers a quality business environment, exceptional access/transportation, and solid financial infrastructure. 2009 was a challenging year but Charlotte’s industrial sector is poised for future success.
Editor’s Note:
Make sure to join us on February 25th at the Westin for our Deal Makers Awards Luncheon. Click here to register now.
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