A large U.S. public pension fund has awarded Jones Lang LaSalle Inc.’s (JLL) independent subsidiary – LaSalle Investment Management – a mandate for making investments worth $575 million in industrial development in the U.S. on its behalf. This pension fund is a long-time client of LaSalle.
As a matter of fact, the U.S. industrial real estate market has grabbed much attention from investors, thanks to the rising internet retailing and supply-chain consolidation. This is, in turn, generating greater demand for logistics infrastructure and efficient distribution networks. But vacancy rates are tightening with construction starts steadily lagging the demand growth, thereby pushing the rents significantly higher in many of the U.S. markets.
In fact, according to LaSalle's Research & Strategy team, the availability rate for industrial supply has declined by 2.2% since the fourth quarter of 2012 and since 2010, the figure has dropped 4.2%. It is further estimated that nationally, the rent will grow at an annual rate of over 3%, with higher growth in the top markets.
LaSalle would aim at bringing together a U.S. warehouse portfolio for its client in key distribution markets directed at long-term ownership. The company plans to achieve this through investment opportunities in the development and leasing of modern distribution properties in populous regions with solid transportation facilities.
JLL currently carries a Zacks Rank #2 (Buy). A number of industrial real estate investment trusts (REIT) are also capitalizing on the growth opportunities in the U.S. industrial market. These include DCT Industrial Trust Inc. (DCT), EastGroup Properties Inc. (EGP) and Prologis, Inc. (PLD), each having the same rank as JLL.
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