Promising forecast for inventory control

By Patrick Burnson, Executive Editor
December 13, 2010 - SCMR Editorial

Regardless of how corporations are executing their supply chain strategies, the end result is that they again are doing something with their industrial real estate.

As noted in today’s news story (“U.S. industrial market ending year on a positive note”) this movement already is beginning to chip away at available inventory nationwide. Absorption is improving notably. At negative 6.2 million square feet through the third quarter of 2010, this number is significantly better than the negative 118.5 million square feet recorded at the end of the third quarter of 2009.

2010 is on track to see the most limited amount of new construction added to the United States industrial inventory since Cushman & Wakefield began tracking the market. We expect that the lack of new product (12.3 million square feet of completions through the third quarter of this year, as compared to 136 million square feet completed during 2008) will push this absorption into the black by as early as mid-2011. This will alleviate the prolonged downward pressure on rents that we have experienced during the past two years.

This all is encouraging news going into 2011. At this time next year, the industrial brokerage firm hopes to be reporting a truly healthy picture illustrated by a continued check on new construction, lower vacancies, positive absorption and healthy rent increases.

Until then, SCMR joins them in looking forward to watching the beginnings of the turnaround grow into tangible, positive near-term progress.



About the Author

image
Patrick Burnson
Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

While many industry analysts contend that distribution centers near U.S. East Coast ports will see a surge of new business after the Panama Canal expansion, real estate experts say this phenomena is already underway.

A new Government Accountability Office report on the effects of changes to truck driver hours of service rules has sparked a war of words between the American Trucking Associations and Federal Motor Carrier Safety Administration, the arm of the Transportation Department that is in charge of making those rules.

The Department of Transportation’s Bureau of Transportation Statistics (BTS) reported this week that U.S. trade with its North America Free Trade Agreement partners Canada and Mexico in May dropped 10.8 percent annually to $92.7 billion, following a 6.8 percent annual decline to $93.3 billion in April.

Carloads headed down 2.5 percent annually to 286,660, and intermodal containers and trailers remained on a growth path, up 2.3 percent to 270,952.

Rumors of transportation and logistics titan UPS acquiring Chicago-based transportation management services provider Coyote Logistics for $1.8 billion have become a reality, with UPS announcing today that the deal is now official.

Article Topics

Blogs · Supply Chain · Inventory · All topics

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.