Site Selection Group Blog

Top 20 Metro Areas for Warehouse Construction

Posted by Josh Bays

Nov 23, 2015 1:49:13 PM

According to industry GDP statistics, the transportation and warehousing industry has grown each year since the 2008 economic downturn. Distribution-Center.jpgFrom 2009 to 2014, the industry’s average annual GDP growth was 4.58%. Driven by growth in e-commerce and a demand for just-in-time products, companies in this sector are in ever more desperate need for new distribution centers in strategic markets that offer the optimal mix of labor availability, favorable business environment, logistics networks and economic incentives.  

 

Transportation and Warehousing Industry Growth

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Speed-to-market concerns

The need to satisfy customer demand in a timely fashion is increasing speed-to-market concerns for distribution center operators. When new distribution center projects are navigating the site selection process, they can shave nine to 12 months off the project schedule by choosing an existing building versus constructing a facility. Given the consistent growth in the transportation and logistics industry, warehouse construction has struggled to keep pace with the demand for real estate. The lack of available buildings is magnified in competitive markets that offer a good mix of workforce characteristics, developed transportation networks, favorable business climates, aggressive economic incentives, and access to population centers.  

 

Top markets for warehouse construction

Site Selection Group researched the top metro areas that are trying to keep pace with the demand for facilities. The table and map below show those metro areas with the most warehouse product under construction. The Riverside-San Bernardino metro area, also known as the Inland Empire, has the most warehouse space under construction based on statistics from the third quarter of 2015. The region has more than 17.5 million square feet of warehouse real estate under construction.

 

The table below shows the top 20 markets for most warehouse square footage under construction.

 

MarketUnder Construction SF
Inland Empire 17,583,660
Philadelphia 14,415,244
Atlanta 14,293,084
Dallas-Fort Worth 14,142,017
Houston 10,094,245
Chicago 10,031,670
Reno 6,024,000
Cincinnati 4,804,304
Charleston, SC 4,635,086
Greenville-Spartanburg 3,990,860
Kansas City 3,728,671
St. Louis 3,067,376
Stockton-Modesto 2,991,398
Minneapolis 2,766,552
Washington 2,607,722
East Bay/Oakland 2,597,860
Oklahoma City 2,437,100
Phoenix 2,423,434
Los Angeles 2,348,227
Detroit 2,111,637

 

 

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Topics: Distribution Centers