Most industry forecasters agree: retail-to-industrial conversion projects are likely to increase in the coming years. There is strong demand for industrial space in urban areas, but land constraints and high costs have limited new development. Adaptive reuse of retail buildings for industrial occupiers is expected to accelerate beginning in 2021.
Overall, new industrial conversions are forecasted to jump 29% in the next few years. Demand is expected to keep pace with new supply as occupiers flock to modern warehouse space.
Demand will require new design features for warehouse and distribution buildings, changes that include increased ceiling heights, multiple mezzanines and an average total square footage increase to three million or more. Industrial demand from both occupiers and investors is predicted to remain robust for the foreseeable future.
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