Central Pa. remains an epicenter of mega-warehouse building
The Greater Philadelphia region, which includes Central Pennsylvania, has led the way nationally over the last six years when it comes the number of big warehouse and distribution center projects, according to real estate firm CBRE Group Inc.
The rapid growth of e-commerce has boosted the need for large warehouse spaces that span 1 million square feet or more.
E-commerce users typically need two or three times the amount of warehouse and distribution space compared with traditional users. E-commerce fulfillment requires more inventory, labor and automation.
CBRE found that 117 large warehouses — those 1 million square feet or more — were built across the U.S. from 2010 to 2016 for a total of 141.2 million square feet. That was up from 99 facilities built between 2003 and 2009.
Of those built in the last six years, 74 were built in 10 markets. Philadelphia led the way with 16 and nearly 20 million square feet, followed by the Inland Empire in California with 13 and 15.4 million square feet.
Five of the 16 built in the Philadelphia region were in the midstate, including three in Cumberland County and two in Lancaster County. A sixth was in nearby Franklin County (see map below).
Looking ahead, CBRE said it expects the Philadelphia region to be one of the busiest markets for big-box construction.
"The Eastern Pennsylvania market is poised to see continued demand for large 1 million-square-foot warehouses along the I-78/I-81 corridor," said Sean Bleiler, senior vice president at CBRE. "Going into 2017, tenant activity is increasing and developers continue to build on speculation to meet quick tenant-occupancy timelines."
Central Pennsylvania finished 2016 with 7 million square feet of new industrial space, according to CBRE. Cumberland County had the most industrial space delivered with five projects totaling 2.9 million square feet.