Page 6 - 2019 Colliers Forecast Book
P. 6

6   Colliers International | West Michigan








                                                           e-Commerce Fulfi llment Center











                                                                                  ...a historically low
                                                                                  vacancy rate, under 5%,

                                                                                  and the unemployment
                                                                                  rate in Grand Rapids-

                                                                                  Wyoming metropolitan
                                                                                  statistical already was a

                                                                                  mere 2.6%.







          GRAND RAPIDS INDUSTRIAL





          The manufacturing sector of the West Michigan region has  purchasing items easier with factors like revolutionary payment
          been a driver that has kept unemployment low relative to other  processing, improved web design, reduced overhead, and
          markets, has helped mitigate economic downturns, and has  wider access, the need for distribution subsequently grows.
          been a catalyst for economic recovery. The diversity of industries  Yet at the same time, as distribution gets more effi cient, the
          creates synergies between local and regional companies,  appeal of online ordering also grows. These factors working
          and with the prime logistical location between Chicago,  simultaneously have made this trend increase in a hurry.
          Indianapolis, Detroit, and even Toronto, West Michigan is an
          ideal manufacturing and distribution market. Industries such as  Not every company, however, has the means to distribute their
          Aerospace, Tier II and III Automotive, Food Processing, and  own product throughout their territory. This is where third party
          Medical Device Manufacturing have all thrived in the region.  logistics (3PL) companies come into play. West Michigan is
          Even retail giant Amazon took notice this year and has since  home to a number of these, and we see the 3PL industry growing
          opened an 850,000-square-foot fulfi llment center in Gaines  in 2019. In 2017, FedEx built a new 340,000-square-foot
          Township, it’s fi rst such building in West Michigan. Amazon  distribution center and warehouse at 3466 Shippers Drive
          has various facilities on the east side of the state, however, saw  NW in Walker. In the spring of 2018, Same Day Delivery
          an opportunity in West Michigan and moved quickly to take  leased space at 3378 3 Mile Road (a former FedEx facility). At
          advantage.                                           the end of 2018, Surface Logistics leased 74,000-square-feet
                                                               at 5738 Eagle Drive.
          Amazon opening distribution and fulfi llment centers around the
          country is a result of the proliferation of online shopping. As  The industrial real estate market currently has a historically low
          e-commerce continues to grow, logistics of quick and effi cient  vacancy rate, under 5 percent, and the unemployment rate in
          delivery of packages to their destinations have become a focal  the Grand Rapids-Wyoming metropolitan statistical area was
          point. The “last mile distribution” model is built in a way that fuels  a mere 2.6 percent in the fourth quarter of 2018. This means
          the demand from two different angles. As the internet makes  companies are operating at near-maximum capacity, while at
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