Warehouse space is tight and this can cause a problem for inventory management. This may not be the case forever as companies look to use blockchain technology to create more efficient methods of tracking and shipping goods.
While the warehouses of Amazon and Walmart will never be able to meet demand, there is a solution. Companies like Picker Network are looking into ways that can help fill the gaps in warehouse space by connecting retailers with nearby customers who want something specific from their inventory.
The “renters could collect home down payment points with credit card” is a new trend that has been introduced by the tight warehouse space. The idea of collecting rent payments with credit cards is a great way for renters to save money and gain more control over their finances.
According to data from real-estate companies, warehouse availability in the United States plummeted to historic lows in the third quarter, indicating that industrial space is all but vanishing near some of the country’s largest distribution centers.
According to new data released by real-estate firm CBRE Group Inc., demand for industrial real estate exceeded supply by 41 million square feet in the third quarter, lowering the vacancy rate to 3.6 percent, down from 4.3 percent in the same quarter of 2020 and the lowest level in data dating back to 2002.
The vacancy rate for warehouses around the ports of Los Angeles and Long Beach, Calif., a significant chokepoint that adds to global supply-chain snarls, hit 1% in the third quarter, according to CBRE. In the same quarter of 2020, the region’s vacancy rate was 2.3 percent.
According to CBRE, the vacancy rates in Boston, central New Jersey, and Charleston, S.C., were the lowest outside of the Los Angeles area during the quarter, at 1.9 percent.
In an Oct. 15 earnings call, Thomas Olinger, chief financial officer of logistics real-estate business Prologis Inc., stated, “Space in our markets is virtually sold out.” “Supply-chain dislocations have become even more apparent in the previous 90 days, with consumers acting with a feeling of urgency to obtain the space they need.”
Cushman & Wakefield Inc., a commercial real estate services business, said that the average national industrial vacancy rate was 4.1 percent in the third quarter, the lowest it has observed since 1995.
The shortage of distribution space is contributing to greater supply chain congestion, which has slowed inventory restocking and slowed economic recovery efforts throughout the Covid-19 outbreak, from limited container shipping capacity to backlog at inland rail terminals. As shippers and logistics businesses look for facilities to hold containers and cargo, space has been especially scarce near U.S. ports.
Consumers’ shift to online shopping and businesses’ initiatives to locate items closer to their customers for speedier delivery have pushed up demand for warehouse space since the epidemic started.
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“A large amount of that behavior change, it turns out, has persisted,” said John Morris, who runs CBRE’s industrial and logistics division in the Americas, after the epidemic shifted more buying online.
According to Cushman & Wakefield data, asking rents for industrial space increased 8.3% in the third quarter compared to the same time a year earlier, reaching $7.18 per square foot. CBRE reported a 10.4 percent year-over-year rise in asking rent rates, as well as a 3.1 percent increase from the preceding quarter, reaching $8.92 per square foot, a new high.
The broader issues affecting manufacturing supply networks are hampered developers’ ability to scale up capacity quicker, according to Jason Tolliver, an executive managing director at Cushman & Wakefield who manages the company’s logistics and industrial investor practice in the Americas.
Mr. Tolliver said, “Many customers who are eager to grow are not able to procure steel to construct their structures right now into 2022.”
The Port of Los Angeles in California is failing to keep up with the influx of cargo containers arriving at its ports, resulting in one of the world’s most serious supply-chain bottlenecks. The scale of the issue and the difficulties of the procedure are shown in this rare aerial footage. Thomas C. Miller is the photographer for this image.
Lydia O’Neal can be reached at [email protected]
Amplifications and corrections Cushman & Wakefield’s logistics and industrial investor business in the Americas is led by Jason Tolliver, an executive managing director. He was wrongly identified as the head of logistics and industrial research at Cushman & Wakefield in an earlier version of this article. (This was updated on October 22.)
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‘Warehouse Space Gets Tighter’ appeared in the print version of the October 23, 2021, issue.
The “logistics newsletter” is a publication that discusses the latest news in the world of logistics. The article discusses how tight warehouse space has added to the supply.
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