Tampabay / September 1, 2022
Low-profile truck terminals might just be the next industrial investor’s gold mine.
As inventory for the product type has proven to be scarce and the demand for more terminals continues to rise with the explosion of e-commerce, truck terminal values and sales have skyrocketed over the past few years.
According to Randyl Dummer of CoStar, the U.S has seen “more than $1 billion in sales so far this year of properties used for transferring freight, truck maintenance, and equipment storage…”. With the topic of the U.S supply chain being top of mind for just about everyone, these properties play a critical role in ensuring that the supply chain sees minimal disruption.
More investment firms such as Bridge Logistics Properties and Realterm Logistics of Annapolis, Maryland have been stepping up to the plate to acquire these properties.
So, what’s the hold-up, and why are these so hard to come by?
Most communities are reluctant to approve new truck terminal projects. While they are critical assets to the countries’ supply chain, they can also lead to an increase in local truck traffic, pollution, and the not-so-aesthetic trailer parking lots. Unfortunately, they also don’t stimulate job growth for the region or offer any additional tax revenue for the local government. Resulting in most of these proposals being killed, almost immediately.
Coupled with a lack of municipality incentive to bring more of these to market, the majority of truck storage yards have been owner-occupied, so with limited supply available and investors snatching them up in record time, finding new space has been difficult. Therefore, most users have decided to stay put to avoid any delay in business.
So, what is the market’s current strategy?
The biggest push right now is to persuade these longtime owner users to sell their properties and those that do, are walking away with their pockets heavy. Jones of Bridge Logistics Properties said that the company “paid $83 million — one of the largest amounts shelled out on record for a truck terminal in the Inland Empire — for the 41,100-square-foot building with a truck wash and nearly 7 acres for trailer storage.”, according to CoStar.
The Takeaway
If you currently own one of these product types and are looking to maximize your value, now is the time to jump. We’re also curious to see how different municipalities plan on addressing the current lack of supply, as the pandemic-influenced growth of e-commerce continues to expand.
Click here to read the full article by CoStar’s Randyl Drummer.
If you’re interested in speaking with an experienced industrial and land real estate advisor about your property or business, feel free to reach out to our team for more information.
John Jackson, SIOR, CCIM. | Managing Director
813 424 3202 | John.Jackson@cushwake.com
JT Faircloth | Director
813 833 3242 | Jt.Faircloth@cushwake.com
Casey Perry | Associate
813 233 6464 | Casey.Perry@cushwake.com
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