Industrial Midwest

Avison Young: Columbus, Memphis see growing interest from foreign investors

Columbus, Memphis see growing interest from foreign investors,ph01

How much do foreign investors like U.S. industrial properties? How about $6.6 billion worth?

That’s how much money overseas investors sunk into U.S. industrial assets during the first five months of 2018, according to the mid-year foreign investment snapshot by Avison Young.

This means that foreign investment in this sector has already surpassed the $5.5 billion that overseas investors spent in all of 2017.

What’s most interesting? Avison Young said that a shortage of industrial supply has actually limited foreign investors. Avison Young says that overseas investors today have to work harder to find suitable industrial transactions.

“There remains significant foreign capital on the sidelines as investors search for assets in a market that has seen tremendous sales volume since 2008,” said Erik Foster, an Avison Young principal and practice leader of the national industrial capital markets group. “Supply of high-quality assets remains low.”

Avison Young said that investors bought 811 industrial assets during the first portion of 2018. Those cities drawing the most attention from investors included Columbus, Dallas, Atlanta, Memphis, Phoenix and Chicago.

Investors in China invested $4.14 billion in U.S. assets through May 31. This makes China the top source of foreign dollars so far in 2018.

Columbus ranked as the top industrial market for foreign investment sales for the first portion of 2018, with $415 million. That is a big jump from the $32 million in foreign investment sales the Midwest city saw during the first part of 2017.

A notable sale in the Columbus market this year took place in March. That’s when Cabot purchased a 673,920-square-foot industrial building from Duke Realty at 1661 Rail Court in the Rickenbacker Global Logistics Park for $31.8 million. That sale took place in March.

Memphis saw $136 million in foreign investment through May 31. That is double the sales volume of $68 million this market saw in all of 2017.