With the continued growth of the e-commerce sector, logistics facilities appear to be among investors’ favorite asset types at the moment. According to a recent report from real estate services firm CBRE, in the third quarter of 2016, the U.S. industrial market was benefitting from tight supply and rising rents. To track the most in-demand markets, CBRE put together a list of cities and regions with the lowest prime yields on logistics assets (the average prime yield for the U.S. is currently 5.84 percent). Here is a list of markets that made the list.
Prime yields on logistics properties in Houston rose 25 basis points year-over-year, but are still below the national average at 5.50 percent.
Yields in South Florida average 5.50 percent as well, though the figure represents a 50 basis point increase compared to the third quarter of 2015.
Yields on logistics assets in Atlanta, on the other hand, declined 25 basis points, to 5.25 percent.
Dallas also experienced an uptick in its prime yields of 15 basis points, ending third quarter of 2016 with an average yield of 5.00 percent.
Logistics yields in Chicago declined 25 basis points, to 5.00 percent.
Yields on logistics assets in Seattle went down 50 basis points, ending up at 4.50 percent in the third quarter.
The Oakland market saw yields decline 50 basis points year-over-year, to 4.25 percent.
Los Angeles experienced the same dynamic, with a 50 basis point drop in yields to 4.25 percent.
In Inland Empire, yields went down 25 basis points, to an average of 4.25 percent.
This Northeast market also saw yields decline 25 basis points, to 4.25 percent.
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