Ohio is one of the most dynamic commercial real estate markets in the United States, made up of three different industrial sector markets: Cleveland, Columbus and Cincinnati. Cleveland is a regional distribution point, relying on heavy manufacturing. Columbus is more geared towards light manufacturing and is a national distribution hub and Cincinnati is a combination of the two. While these markets have local differentiators, they have all followed a clear national industrial development trend: new warehouses built in Ohio have steadily increased in size and height. Last mile and e-commerce have been amongst the most active parts of commercial real estate in the last few years, including Ohio. Reshoring has also become a notable trend, as companies bring back mission-critical tasks to the United States. Most of Ohio is in the Rust Belt, the historical home of manufacturing in the United States, and as international uncertainties over trade have emerged in recent years, companies have had to rethink their supply chain models and many have brought them back stateside.
Regardless of industrial-occupier industry and location, modern, larger distribution facilities have been in high demand to efficiently and quickly connect goods to the end-user. These larger assets are more desirable because they have increased storage and operational efficiency, leading to tenants getting more value per square foot of leased space.
As a result of these industrial real estate trends, and to accommodate the needs of companies that use these types of facilities, Ohio has seen warehouses and distribution centers grow in size over the past 40 years.
Data from the table below shows gradual growth in each category tracked for warehouse/distribution construction in Ohio over the last four-plus decades for buildings over 75,000 square feet.
Warehouse/distribution buildings in Ohio have gone from an average of around 189,000 square feet in the 1980s to over 410,000 square feet today, an increase in size by over 117%, while parking has increased by nearly 81% over that time period. In this same time period, the average number of docks per building has increased by over 155% and the average minimum ceiling height has grown by nearly 60%.
Anecdotally, most industrial property experts observe similar trends for their markets, but statistically, in Ohio, we can point directly to building size increases, as well as growing ceiling heights, more docks per building and expanded workforce parking. Ultimately, the construction and growth in size of new warehouse/distribution buildings in Ohio has made the region more competitive at the national and international level as a place to do business.
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