Nareit’s REITworld: 2021 Annual Conference features Jim Connor Interview

Video interview appears on Nareit site. 

Duke Realty CEO Sees “Virtually Insatiable” Demand in Logistics Sector

by Sarah Borchersen-Keto

Jim Connor, chairman and CEO of Duke Realty Corp. (NYSE: DRE), participated in a video interview in conjunction with Nareit’s REITworld: 2021 Annual Conference.

Connor discussed how the logistics industry has responded to supply chain bottlenecks. He noted that it has been “forging ahead significantly” over the last 18 months in terms of bringing new product to ports and locations all over the country.

“We’ve got virtually insatiable demand, where demand is outpacing supply something like two to one,” Connor said.

Vacancy rates for logistics properties are in the mid-3% range, Connor said, which is “virtually unprecedented territory” given that the 10-year rolling average is about 6.5%. “We’re in a very unique position that the logistics business has never been in before,” he added.

In terms of speculative development, lease-up times are very short, Connor said. Duke has ramped up its development business by about 75% in 2021 over 2020 levels, and spec buildings are leasing up on average one month after completion. He noted that 11 out of 12 spec buildings in southern California have already been leased before completion.

Meanwhile, Connor said Duke has done a number of long-term leases in the last two years as a consequence of retailers wanting to control their space for a long period of time, given the large amount of investment going on inside the building.

Click HERE for interview and article.