NAI James E. Hanson gathered some of our leading brokers to provide insights on what the market holds for a variety of asset classes as well as key factors that will impact our industry throughout 2019.
Eric Demmers, Sales Associate, on the Ports Market
While uncertainty surrounding the international trade conversation remains, it’s had little impact on the health of the market surrounding the Ports. Although changes in tariffs and other geopolitical developments can be potentially volatile to businesses’ bottom lines, the appeal of unmatched access to the international shipping system and New York City’s population centers will continue to outweigh the risks, fueling a robust market in the Ports that shows no signs of slowing down.
On a more specific level, as one of the more mature markets in the region, the Ports submarkets’ stock of older, increasingly obsolete Class B, C, and D industrial products will place increasing strain on the limited Class A supply, leading to continued high pricing for these assets. To meet this demand, developers will need to showcase even more creativity in site selection and redevelopment to optimize available opportunities to make the most of an expensive but hot market.
Although, if pricing continues on its current trajectory and development continues to become more difficult, it is easy to see logistics users begin to look to less expensive and better supplied Port-focused markets to the south over the next several years. However, as I alluded to earlier, the importance of the New York City market will mean that the market will continue to boast the strong fundamentals that make it one of the most in-demand in the region.