Industrial real estate projections for 2023

The demand for industrial real estate is on the rise, and the increasing technological advancements we see year after year only serve to push this demand further. While the Covid-19 pandemic brought uncertainty to nearly every sector, projections for the future of industrial real estate have remained optimistic, with growth expected to continue. This week, we’ll explore these projected trends for 2023.

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E-commerce and logistics

The rise of e-commerce has been a significant driving force behind the growth of industrial real estate. With more people shopping online than ever before, companies need more space to store and distribute their products. This trend has only been amplified since the Covid-19 pandemic began in 2020, which led to a surge in online shopping. As a result, the demand for industrial real estate has risen steeply year over year, with companies scrambling to secure warehouse space to meet their needs.

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In addition to e-commerce, logistics companies are also seeking larger warehouses to accommodate their expanding businesses. With the rise of same- and next-day delivery options, logistics companies need to be able to store and distribute products quickly and efficiently. According to [a report by CBRE](https://www.cbre.com/insights/briefs/thriving-us-industrial-market-well-positioned-to-withstand-economic-headwinds#:~:text=Despite a slowdown in demand,The 1 billion sq.), the demand for industrial real estate is expected to increase by 850 million square feet by 2023, with e-commerce and logistics companies accounting for a significant portion of that demand.

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Sustainability and green buildings

Sustainability has become a hot topic in recent years, and industrial real estate is no exception. As more companies strive to reduce their carbon footprint, the demand for green buildings continues to rise. Green buildings are designed to be energy-efficient, with features such as solar panels and rainwater harvesting systems. They are also made with sustainable materials, reducing their impact on the environment.

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The benefits of green buildings go beyond environmental sustainability. They are also more cost-effective in the long run, as they consume less energy and require less maintenance than traditional buildings. Furthermore, they can improve employee productivity and well-being, as they provide a healthier and more comfortable work environment.

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Automation and technology

Automation and technology are transforming the industrial real estate industry. With the rise of automation, companies are looking for larger warehouses to accommodate their robotic systems. These systems require more space and higher ceilings, which is driving the demand for larger industrial buildings. Additionally, technology is being used to improve the efficiency of warehouse operations. For example, sensors can be used to monitor inventory levels in real-time, allowing companies to manage their warehouses more effectively.

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The adoption of automation and technology is expected to continue to grow in the industrial real estate industry, with this growth being driven by the need to improve efficiency and reduce costs, as well as the desire to provide a safer working environment for employees.

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The future of industrial real estate is looking bright, with projections indicating that the industry is set to continue growing. E-commerce and logistics, sustainability and green buildings, and automation and technology are all expected to play significant roles in this growth. As we continue to monitor 2023, it will be interesting to see how these trends shape the industrial real estate landscape.

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In conclusion, the industrial real estate industry is poised for continued growth over the next few years. As the world becomes increasingly digitized, the demand for industrial real estate is only going to increase. E-commerce and logistics companies will remain primary drivers in the demand for warehouse space, while sustainability and green buildings will become increasingly important to companies looking to reduce their carbon footprint. At the same time, automation and technology will transform the way warehouses operate, making them more efficient and safer for employees. As investors and developers seek to capitalize on these trends, the future of the industrial real estate industry looks bright.

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