Upstate listed as one of the top U.S. mega-warehouse markets

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The Greenville-Spartanburg metro ranks among Chicago and Atlanta as one of the hottest spots for mega-warehouse leasing in the nation, according to a recent report from CBRE.

For the first time, the Upstate market made the list of top 10 U.S. locations with the largest warehouse transactions last year, when the average leased warehouse size increased from 1,038,183 square feet in 2020 to 1,053,000 square feet.

According to the commercial real estate firm, a rebounding economy and continued boom in e-commerce sales have driven the need for more and larger warehouses.

“Demand for industrial space remains at an all-time high,” John Morris, executive managing director and leader of CBRE’s Americas Industrial & Logistics business, said in a news release. “Space remains historically tight, but we still have just enough product to keep pace with demand. Occupiers are in a highly competitive market and space for deals this size are becoming few and far between, likely to result in growth markets becoming even more popular in 2022.”

General retail and wholesale uses claimed most of the 100 largest leases (44 transactions), followed by e-commerce-only occupiers (35 transactions) and food and beverage companies (15 transactions).

“It’s notable to see Greenville-Spartanburg on this list for the first time,” James Breeze, global head of industrial and logistics research for CBRE, said in the release. “As core markets continue to struggle with availability, growth markets will begin to see larger deals as occupiers look to address their space needs.

For the overall industrial market, CBRE reports that the Upstate witnessed a record year as tenants moved into more than 10 million square feet of manufacturing and warehousing space.

Asking rates hit a historical high of $4.58 per square feet (including costs of property taxes, insurance and maintenance), while the vacancy rate hit another record low of 3.33%, according to data from company spokesperson Jessica Carroll. CBRE attributes the Upstate’s surge in new development to strong pre-leasing activity for speculative properties.

The leading markets for 100 largest warehouse leases in the nation include:

• Chicago (12 leases at 12 million square feet)
• Pennsylvania’s Interstate 78/81 Corridor (11 transactions at 12.4 million square feet)
• Southern California’s “Inland Empire,” including Riverside, San Bernardino and Ontario metro areas (10 transactions at 10.2 million square feet)
• The Dallas – Fort Worth metro (9 transactions at 8.6 million square feet)
• Atlanta (8 transactions at 8.4 million square feet)
• Indianapolis (6 transactions at 5.5 million square feet)
• Phoenix (5 transactions at 6 million square feet)
• Columbus, Ohio (5 transactions at 5 million square feet)
• Central New Jersey (5 transactions at 4.6 million square feet)
• Greenville – Spartanburg (3 transactions at 2.7 million square feet)