Q&A: South Florida Industrial Market Continues Evolution
More than 3.4 million square feet of industrial and flex space is currently under construction in Miami-Dade County, and an additional 50 million square feet of industrial space will need to be constructed over the next five years to meet the region’s population growth, according to research from Colliers International South Florida.
Connect Media asked Louis Archambault, partner at Saul Ewing Arnstein & Lehr, to share insights about South Florida’s ever-changing industrial market. Check out his responses in our latest 3 CRE Q&A:
Q: The South Florida industrial market is booming at the moment. Do you see that slowing down anytime soon?
A: Demand for South Florida’s industrial market continues to remain strong and I don’t expect that to change anytime soon due to the region’s geography, zoning designations limits and continued population growth. However, there are many new technologies that could disrupt South Florida’s industrial market. From autonomous vehicles to 3D printing, industrial owners need to start thinking about how these types of technologies could transform the industrial marketplace. For example, driverless trucks could impact the way distribution centers are designed since driverless trucks can operate around the clock. A typical model of five distribution centers strategically located across the U.S., as an example, could shift to two larger distribution centers located in entirely different markets in the future.
This scenario got closer to reality this month when a law went into effect in Florida that made it legal for fully autonomous vehicles without even a safety driver present to drive on public roads. While the law applies to self-driving vehicles currently being tested, it promises to speed up the process of bringing self-driving cars to our streets. In South Florida, autonomous vehicles will have the greatest impact on last mile distribution centers. Developers will need to account for their demands and for the disruption of the laws, codes, rules and regulations governing these vehicles.
Q: What’s the biggest/most noteworthy trend that you have seen in South Florida industrial market?
A: The most noteworthy trend that I have seen in the South Florida industrial market is the variability of industrial projects. While South Florida does not have the profile to support a million plus square foot distribution center, it does have a profile to support multiple large, last-mile or smaller urban distribution centers that may be available for lease with technology linking them together. As industrial buildings continue to be constructed or retrofit with internet-connected sensors, the buildings themselves will contribute a massive amount of data flow that can be used productively. This real time flow of data can be used to assist in developing specific buildings, improving operations based on verifiable concurrency requirements, and reducing impact risk allowing for further urban integration of industrial projects.
Q: What is the biggest opportunity right now in the South Florida industrial market?
A: The biggest opportunity currently is the urban integration of industrial projects. Consumers want and expect products to be delivered in individualized, customized quantities. This is only possible with a large amount of industrial applications in urban areas; either through quick fulfillment centers, distribution lockers, multiple non-centralized distribution methods and light industrial manufacturing capabilities. The emergence of 3D printing technology is opening up urban integration options for industrial projects. There are a vast number of items capable of being printed with a 3D printer—from building materials, food, clothing, prosthetics to nano-sized gears. Because 3D printing in many instances does not create a lot of noise, space, hazardous materials and warehousing, it defies traditional zoning and land use designations and can allow for the duplication industrial processes in more urbanized areas.