ST. LOUIS, MO/June 25, 2017 (STLRealEstate.News) Industrial Real Estate Scene – There are never-ending stories about how millennials are changing commercial real estate design and layout as we know it today. They’re all about collaboration, open-aired spaces, and big ceilings with lots of light to flood the work-space. Less talk is occurring regarding their desire to change the industrial real estate market as well. Three aspects of that market, huge bulk distribution centers, the bread-and-butter office-warehouse sector, and obsolete manufacturing/warehouse buildings, are changing quickly because of millennial interest, especially in St. Louis and the Twin Cities region.
One reason this change is flying under the radar is because industrial real estate isn’t as visible as high-profile corporate offices or snazzy new apartments with unique fixtures. However, industrial real estate is perhaps the most telling for where an economy is headed in the future.
Probably the most major way millennials are influencing industrial real estate is through the eCommerce explosion. With their buying power on full display, eCommerce has exploded, and the supply chain for delivering goods purchased over the Internet has created the need for much larger bulk distribution warehouses than we have ever seen in the past. The first St. Louis example is the build out of Amazon warehouses on the outskirts of the city. These distribution centers will enable massive shipping capabilities with even the incorporation of same-day delivery options.
“Thanks to eCommerce, your brick-and-mortar retailers are going out of business, and in their place these huge distribution warehouses are popping up,” said Chris Garcia, a principal with St. Louis Park-based commercial real estate brokers Lee & Associates and an expert on the industrial market. He provided the quote to the StarTribune. “Basically, say goodbye to Macy’s and say hello to a box in a cornfield.”
Additionally, millennials want these warehouses to be close to urban cores with open-air collaborative elements and something that makes the place “cool” to be in.