It was the lead article in a Long Island business publication not long ago, but not news to the commercial brokerage community. A shortage of available industrial buildings is causing prices to rise substantially. With the availability of low-cost financing and economic incentives, this is most pronounced in buildings for sale. But, more recently, there has also been a shortage of quality buildings for lease. Brokers are seeing this in the form of multiple competing offers on the same building.

Yes, of course, business confidence has been growing nationally and locally. But, one element that is not often discussed is the lack of new construction on Long Island. There are a few build-to-suit projects underway or recently completed, but with one or two exceptions, there is virtually no speculation building of industrial property in Nassau and Suffolk counties. In the 1980s, industrial “shells” dotted the industrial landscape. These were buildings whose exteriors were completed, but awaited an interior finish custom-designed for the buyer or tenant. This delivery method basically stopped dead in its tracks when financial institutions refused to finance new construction without a corresponding lease or contract of sale in hand.

What does this mean to you? I foresee a continued rise in prices due to a diminishing supply. If you will need to expand your facility, start looking now. And assume any building that interests you is interesting to others!

Oh, the possibilities!