Is Industrial Buffered From Technology?

While technology advancement may be concerning many real estate investors, but industrial developers aren’t worrying about the impact of technology.

Technology is at the forefront of every developer’s mind. From the potential of a future with driverless cars to smart-home technology and fiber infrastructure, developers are challenged to keep up with the changes and deliver relevant product. That is, most developers. Industrial developers, on the other hand, are much less concerned with technology changes—adding yet another benefit to the booming market.

Rene Ramos Jr.

The industrial market is buffered, chiefly, because industrial product doesn’t pander to consumers. “I don’t think that technology will affect the industrial market,” Rene Ramos of Coldwell Banker Commercial, tells “The industrial market is a little different because you aren’t trying to attract people to a warehouse. There is a buffer because warehouses don’t service customers. Some things can’t be replaced, and I think warehouses will always need workers and trucks. Today, Warehouses are still your typical concrete tilt-up, high ceilinged facility with at least one dock, and that is it.”

Another factor is the fact that industrial developers deliver product much more quickly that developers in other asset classes, and as a result, they can more easily mitigate against obsolescence. While developers aren’t concerned today, Ramos says that future technology advancement could have an impact. “It is hard to say that in 10 years, semi trucks will not exist,” he says. “We get so much product that comes through the ports, and this is how the rest of the US gets that product. It will be interesting to see what comes out in 10 years.”

While technology isn’t being integrated during the development phase, industrial tenants are looking at ways to increase efficiency through technology. “Technology could increase efficiency, and I am sure that a lot of companies would be interested in that,” adds Ramos. “Amazon, for example is trying to use drones to deliver product. If that happens, there will be fewer semi-trucks needed to deliver packages. So, in some ways, technology will make us more efficient and effective. Potentially, there is an impact there.”


As read in Globe St.

By Kelsi Maree Borland