Report predicts demand for industrial buildings in SC

Demand for industrial buildings in South Carolina is expected to grow because of the construction or expansion of major manufacturing plants in the state and the rapid development of e-commerce nationally, according to a recent report from Colliers International.

“To capitalize on this, investors and developers are expanding their portfolios across the state,” the report said.

In Lexington County, the Miller Valentine Group has announced plans to build a speculative industrial building at the Lexington County Industrial Park near I-77 and I-26. It’s the first such effort by a private developer since 2009, according to Colliers, which is the leasing agent for the property.

Here are highlights from the Colliers report, which was released in March:

Greater demand for industrial buildings

Construction projects by Volvo in Berkeley County, Boeing in Charleston County, BMW in Spartanburg County and Daimler in North Charleston, along with the presence of five major tire manufacturing companies, is increasing the demand for industrial buildings by suppliers and distributors.

The Daimler plant is expected to create at least 1,300 jobs. Boeing’s expansion is expected to add at least 2,000 jobs by 2020, and Volvo will hire 2,000 for its initial production phase.

E-commerce

The expansion of e-commerce has created a demand for products to be delivered faster. “Distributors are searching for larger distribution centers along the East Coast to fill consumer orders within two-three days,” the report said.

South Carolina’s location makes the state a prime target for distribution centers and warehouses.

“South Carolina has access to 78 percent of the nation’s population within a 16-hour truck drive of Columbia,” the report said. South Carolina facilities allow companies to fill customer orders quicker.

Charleston port

The location of Charleston’s port makes it popular for companies involved in e-commerce and manufacturing suppliers. The port is 500 miles from Miami, Atlanta, Nashville, Charlotte, Richmond, Cincinnati and Pittsburgh.

The port has started – or is scheduled to begin – several major capital improvements. They include deepening the port to accommodate the bigger ships that can now pass through the Panama Canal following its expansion, which opened in June 2016. “The project will allow larger ships to access the port at any time.”

Midlands potential

Statewide, the vacancy rate for industrial space was 7.1 percent in the fourth quarter of 2016. In Charleston, the rate was 4.2 percent, while the Midlands’ rate was 7.4 percent. The availability of large buildings – at least 200,000 square feet – is important to companies who want to move into the area and quickly begin operations. While such buildings are scarce /in/ Charleston and Greenville, the Midlands has six, including the former Mack Truck plant near Winnsboro and the former Bose plant in Blythewood.

The Midlands also is the only South Carolina industrial market with so-called “mega sites” available for development. The report defined a mega site as having 1,000 contiguous acres of developable land with access to utilities, transportation, and a workforce to support a major employer. The Midlands region has sites available in Clarendon, Newberry and Kershaw counties.

This story was originally published April 8, 2017 at 11:23 AM with the headline "Report predicts demand for industrial buildings in SC."