To Our Valued Clients:

The convergence of a variety of positive factors has invigorated the outlook for industrial investments to a level unseen in past years. The prospects of accelerated economic growth and increased corporate investment under the new tax law will likely bolster demand, while the ongoing e-commerce inspired structural shift benefi ting the sector remains on course for expansion. These forces have pushed vacancy rates to record low levels despite rising construction and the momentum can be felt in every aspect of the sector, from ports to shipping hubs to local last mile distribution facilities.

The strong, steady gains in fundamental performance through this cycle have pushed industrial prices aggressively, though cap rates have enerally remained stable over the past year. Some investors have expanded their pursuit of yield to secondary and tertiary markets, lifting velocity in smaller metros and boosting liquidity. Lending from a wide range of sources remains liquid, but underwriting standards continue to demonstrate sound principles. As the pace of economic growth accelerates, it is likely it will be met with rising interest rates, which could modestly restrain investor activity.