Warehouse space nationwide is getting harder to find. The U.S. industrial market vacancy dropped to a 27-year low of 4.2% in the first quarter of 2022 according to Savills, a leading real estate services company.
Lack of inventory has resulted in increased rents. Asking rents for industrial real estate nationwide rose year-over-year by almost 9% in the first three months of 2022, continuing the trend of rising costs in response to limited availability.
This rise in demand has led developers to move forward with approximately 750 million square feet under construction nationwide.
Developers in Wisconsin are actively adding additional warehousing space. The city of Janesville constructed two speculative buildings in 2022 adding 400,000 square feet of warehousing. Developers in the Madison area will add roughly 780,000 square feet of new speculative space.
Our new program encourages speculative builds
Over the past few years, Alliant Energy and our community partners have experienced limitations responding to expansions requiring existing building space. Tertiary markets such as Fond du Lac, Sheboygan and Platteville have below 1% vacancy. These markets are less known to developers, many of whom are hesitant to develop in areas with little history of successful speculative builds.
To encourage developers, we instigated a unique industrial building partnership program. This program offsets potential holding costs for up to 30 months should a developer not find a tenant upon substantial completion.
This has generated new interest in these markets. Two potential 200,000-square-foot speculative buildings are now under consideration in Fond du Lac and Beaver Dam.
For more information on Alliant Energy programs and available real estate, contact our economic development team.
Wisconsin sees an increase in speculative buildings
Senior Business Attraction Manager