RAPID RESPONSE TO SUPPLY CHAIN AND REAL ESTATE COSTS

Real estate

RAPID RESPONSE TO SUPPLY CHAIN AND REAL ESTATE COSTS

Rising operating costs for industrial companies demand a rapid response.

Rapid Response to Supply Chain and Real Estate Costs

Numerous articles have been written about the strain the pandemic has had on global and domestic supply chains. Transportation costs are up across the U.S., putting pressure on companies to change their location strategy to lower costs and risks.

The newest challenge is also due to supply, but this time it is industrial real estate. Over 70 million square feet of industrial real estate was added across the U.S. during the first three months of 2021. And another 350 million is under construction, but it’s not enough. Demand for space across the U.S. is exploding, and supply can’t keep up. As a result, the latest reports show that industrial lease rates reached all-time highs in the first quarter of 2021.

However, it’s not enough that industrial occupiers must deal with tight supplies of available space and skyrocketing pricing pressure. Consider these other issues which confound real estate decision making:
  • Property tax rates on production and distribution equipment can vary by 900% in the Southeast U.S.
  • Power costs can vary by more than 250% across the Midwest.
  • Wages for machine operators vary 47% in the Southwest.
A Rapid Response to Increasing Costs

Colliers Rapid Response® technology (powered by Indsite®) was created to quickly pinpoint and compare available real estate options, with the added capability to search for locations with low labor costs, deep labor pools, low-cost utilities, affordable property taxes, and proximity to critical infrastructure.

In a matter of hours, Colliers Rapid Response simultaneously analyzes real estate availability and

  • Labor analytics
  • Labor union activity
  • Proximity to intermodal and inland ports
  • Recurring operating costs (wages, taxes, and utilities)
  • And more…
Real Estate and Big Data = Value

Location intelligence and big data are driving location decisions in 2021, creating tremendous value for industrial companies. Colliers Rapid Response is a future-proofing response for companies that want to optimize their location decisions.

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