While core industrial markets continue to thrive, Colliers International’s latest research report—10 Emerging U.S. Industrial Markets to Watch in 2017—explores the markets positioned to experience the most robust increases in demand from occupiers and owners. Learn more about one of these markets: Indianapolis.
“Known as the ‘Crossroads of America,’ the Indianapolis market has the distinct geographic and logistical advantage of being the intersection point of eight interstate systems. As a result, 75% of U.S. and Canadian populations can be reached in a day’s drive. With waterway access to the north Chicago area and to the south Louisville area, it may surprise some that Indiana ranks sixth in the U.S. for waterborne shipping and boasts the only statewide port system with direct waterway access to two U.S. coasts. Indiana also continues to earn top marks for its appealing tax structure and business-friendly regulatory environment.” — Brian Zurawski, Executive Vice President & Co-Market Leader | Indianapolis
Developers continue to find competitive land opportunities and favorable pricing in the Indianapolis industrial market, leading to more than 20 million square feet of industrial development since 2013. The Indianapolis International Airport is also the sixth-largest U.S. cargo system. The state’s business-friendly climate incentivizes development with tax abatements while the Indianapolis area lures operations with a deep labor pool.
Indianapolis’ central location in the Midwest makes it a logical e-commerce hub. It is also home to the second-largest FedEx hub in the world, which is a key component to the market’s success.
Robust demand, particularly for large, modern bulk distribution centers, lowered the overall vacancy rate from 8% in 2015 to 5.4% in 2016.
After averaging 3.95 million square feet annually since 2008, overall net absorption reached 9.9 million square feet in 2016—making Indianapolis one of the top 10 markets in the country in terms of overall net absorption.
The variety of speculative supply being developed in Indianapolis can appeal to a wide range of users. Because of this, nearly 4 million square feet of product completed construction in 2016 and another 6.4 million square feet is underway at the beginning of 2017.
With low asking rental rates (below $4.00 per square foot NNN market-wide), users are increasingly looking to Indianapolis as a well-priced option for distribution operations in the Midwest.
To learn more, explore the 10 Emerging U.S. Industrial Markets to Watch in 2017.