Prior to the precipitous events of COVID-19, we were experiencing significant supply chain shifts across North America in both rural and urban industrial markets. With expectations surrounding the new normal and the rapid uptick pressuring the supply chains, our focus remains committed to meeting the industrial real estate demands of e-commerce. The increasing pace of delivery contributing largely to final-mile distribution will continue to create demand for warehouse and distribution facilities in our tier one cities. Unlike many tertiary markets that have seen over-saturation to accommodate the final-mile logistics, our largest markets and point of entries are having to meet the speed and proximity requirements challenged in highly congested markets for a decentralized network of delivery. The majority of existing warehouse and distribution facilities surrounding our cities are challenged by the lack of capacity and modernization necessary to fulfill the specifications required to meet the business solutions of logistics and distribution occupiers.

The requirement for capacity and modernization of current U.S. industrial inventory in select first tier markets to handle continued growth in e-commerce is presenting vast opportunities for industrial real estate. Industry experts point to the use of multi-story as the norm in key markets in southeast Asia however this is still a novel concept in the U.S. As solutions continue to develop, building heights by going vertical in the U.S. keeps increasing. We have summarized why going vertical and modernizing warehouses and distribution facilities will contribute to meeting occupier demand.


At Colliers, we are tracking the changes in the supply chain and the direction of growth in e-commerce in order to provide solutions for occupiers in tier one markets challenged by inefficient buildings and availability of prime land for development. The vast opportunities to satisfy the demands of the e-commerce consumer will require embracing flexible industrial warehousing solutions of going vertical, the addition of technological advancements, and exploring novel building design concepts.

About the Authors:

As a Managing Director at Colliers, Robert Lella represents property owners, as well as national and regional occupiers with their acquisition and disposition requirements. Areas of expertise include sales and leasing of warehouse and distribution facilities, as well as professional offices with a distinct focus in the outer boroughs of NY including the Bronx, Westchester and Connecticut. Robert specializes in structuring and negotiating of sale and lease transactions, site selection, repositioning projects, as well as supply chain logistics.

 Head of Location Strategy Consulting, Gregory Healy, a senior vice president, leads the Supply Chain Solutions team in the U.S. for Occupier Services, as well as Workforce (Labor) Analytics Consulting practice. With over 20 years of global manufacturing and supply chain experience as both a senior executive in the corporate world, as well as owning a supply chain consulting practice and a third-party logistics business, Gregory has real world experience that brings a unique perspective to the Colliers team.