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South Euclid Business Park
American Eat Co
Dragoon Business Park
South Dodge (Caylor Industrial Park)
Famous Sam's at Ruthrauff Commerce
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Old photos either came from the Pima County Assesor's website or friends and family
Put together by Max Fisher, Industrial Real Estate Broker with Cushman & Wakefield | PICOR
20% Office / 80% Warehouse
37,026 SF (0.85 Acres)
AC Office / EVAP Warehouse
Listed by Max Fisher of Cushman & Wakfefield | PICOR
The Tucson solar market seems to continue to grow and prosper. In addition to solar install growth, Solar Research & Development continues to grow throughout Tucson. With 286 days of sun in Tucson, the solar industry is very appealing.
As the virus continues to damage the economy, the housing market seems to feel little effects, including housing improvements like solar and remodels. There continues to be multiple offers on listings and renters are having trouble finding housing, especially affordable housing. This high demand, low supply scenario creates a perfect storm for housing developers. This increased development directly benefits the industrial market as the developers need warehouses and industrial yards to store building materials. There is also a huge demand for trades related businesses that serve the housing market like solar, plumbing, electrical, and HVAC. Those trades related businesses typically occupy small to mid-sized industrial property.
Most of the tenants in this building were small bay distribution related.
Despite the massive economic effects from the virus, the Tucson industrial market continues to stay strong. The vacancy rate is 6.1% and we expect that rate to remain around 6-6.5% over the next year. As of May, 16, in Arizona alone, 72,523 PPP loans were approved, totaling over $8.6 Billion dollars. Not sure of the amount received in Tucson but this significant amount of money has provided a backstop or life line to a lot of small business in Tucson. This is a reason why there has not been much change to the occupancy rate in Tucson to date. We also expect small bay industrial to remain strong as most tenants are considered “essential”, commodity driven and not affected by closures. Small bay industrial spaces less than 10,000 SF are 95% filled with lease rates increasing 10-20% over the past two years. Larger bay industrial spaces have smaller rent increases and are steadily filling up, mostly driven by the building materials market and Ecommerce distribution.
We can attribute this continued industrial market strength to three main economic drivers; distribution, the mining industry, and the housing market.
This article is about 10 actions that helped businesses prosper and even grow during these changing times. Most of these tips are going to help businesses prosper during coronavirus times AND normal economic times. It’s all about changing, adapting and prospering.
- Having a simple, functional website. As consumers are stuck at home, they are going to the internet to search for what they need or want. Having a website that offers the product or service in a very direct and transparent manner helps big time. If you have an outdated website or don’t have a website at all, check out weebly.com. You can build a website that is as easy to build as a Facebook page. Costs on Weebly start at $10-20 per month.
- Ditch the landline. Again, consumers are stuck at home and are contacting businesses by email, phone, or text. If you have a landline, you can only answer it in your office and can’t text. The millennial generation prefers to text. Ditch the landline and build you business on you cell phone. You can text pictures of your product to customers, send videos, and communicate more dynamically.
- Start posting more and more on social media. For the third time, consumers are stuck at home, they are on Facebook, Instagram and Twitter more than ever. Be relevant, post valuable content and do it every day. Don’t let your consumer forget who you are. Targeted advertising is another way to boost your social media presence. Paid boosts can also be done on Facebook for $5 or more.
- Create an email list and send an email each week, minimum. Your email list should be every past customer, potential customer and those who are active in your area of specialty. Make sure you’re adding an article of value to your customers. Stay relevant and don’t let the customer forget who you are. An email drip campaign is as easy as creating a Facebook page and can be done for less than $20. Check out mailchimp.com for mass emails and templates.
- Always pick up your phone. The customer has access to the internet and all of your competitors within 20 seconds. Answer your phone or they will just go online and find the next business.
- Contract with the big guys (Amazon, Grubhub, Yelp etc) I get it, they charge fees but they have the most powerful SEO and the downloads. A bird in the hand is better than two in the bush, especially in a down market.
- A bird in the hand is better than two in the bush. If a customer comes your way, get aggressive on the deal otherwise your competitor will. This is not a normal market and some income is better than no income. It’s going to become more competitive.
- Reduce overhead. Businesses with cheap rent, cheap advertising, smaller payroll can weather the storm. The businesses with high retails rents are going to suffer. The businesses that have back office or industrial rents are doing fine. Also, the businesses that advertise online are doing great as well because online ads are inexpensive and doesn’t require retail exposure.
- The ability to sell online. Consumers now realize they can sit at home, order groceries, clothing, takeout, and anything else they need. Now that they’ve been forced to use these apps, they will use them more in the future, virus or not. Make sure you are able to take orders on your website, over the phone or email. You can have an online store on your website for less than $40 per month and building it is just as easy as building a Facebook page. Visit weebly.com
- Have control over production. Businesses that relying on overseas product are hurting. The supply chain has been affected. Look for other domestic companies that can produce your product or bring manufacturing in house. Lots of companies use are purchasing their own 3D printers, CNC machines, etc. If you have control or somewhat of a voice in the manufacturing process, you can innovate more and quicker. These times are changing so quick, companies need to be able to adjust their products yesterday. You can also create other products.
Retail frontage on Benson Highway
Located ½ mile from the I-10/ Kino Boulevard interchange
Lot Size 21,780 SF - (.50 Acres)
Zoning - C-2, (City of Tucson)
Doors - 12x12
Ceiling Height - 17’
Year Built - 2006
For more info, please contact Max Fisher of Cushman & Wakefield | PICOR
520-465-9989 (call or text)
- Size - 15,900 SF Bldg and 59,644 SF Land
- Layout - 40% office/showroom 60% warehouse
- Loading - Dock and grade loading
- Power - 1200 amp 240 v
- Sale price - $1,350,000
- Adjacent parcel of vacant lad for sale - 37,370 SF, $199,000
- Zoning - C2
- Less than half a mile from I-10
For more infomartion contact Max Fisher of Cushman & Wakefield | PICOR
520-465-9989 (cal or text)
Why is this? Most retail and office businesses have been deemed as non-essential and have shut down while people still need homes, apartments, and industrial businesses (trades companies, distribution of product, and manufactured goods).
Below are a few predictions for the post Covid market.
1) Non-medical office footprints will shrink. With work from home orders, employees are realizing they can do the vast majority of their work from their home office, save day to day travel time and gas money. This will shift the office market substantially. We've already seen this trend in the residential real estate market but Covid is going to force this trend to grow throughout the entire market.
2) Retail businesses impacted by the retail shift will be forced to adapt quicker than expected. We all know about the impact that distribution companies like Amazon, Doordash, GoPuff and others have had on the retail market but now having retail storefronts shut down is impacting this shift big time. I am already starting to see retail businesses shift into industrial spaces and change their business models from walk by and drive by traffic to production in a warehouse, advertising online, and distributing straight to the consumers doorstep. Pay attention to how restaurants are shifting with takeout, social media advertising and production.
3) Interest rates will continue to decrease. As businesses continue to remain shut down, the market will continue to suffer. One of the ways to combat this effect is to decrease interest rates. Obliviously how long we are shut down for will affect the interest rates.
4) Increased migration from metropolitan cities like New York or Seattle. Viruses aren't going away. Cities that have people stacked on top of each other are the virus hot spots. Expect some type of migration to less condensed cities with warmer climates like Phoenix, Dallas, San Diego and Tucson.
5) Last mile distribution will continue to take off. As we are forced to stay home consumers are starting to us last mile distribution companies more and more. Think Instacart, Doordash, Amazon, and other Ecommerce companies. Once businesses open back up there will be a lot of consumers that found a grocery delivery app like Instacart during the shut down that will continue to use Instacart. why spend a few hours driving to the grocery store and shopping when you can have it all delivered straight to your door for the same price?
6) Businesses that seemed to become saturated will start to thin out. A few years ago breweries and gyms started popping up everywhere. These start up businesses usually don't have the capital or reserves that non start-up businesses do have while they all have the same over head. Combine smaller reserves with shutting down the business and more competition........
For more market updates visit Indsutrialtucson.com
China is the manufacturing powerhouse of the world which makes the US very reliant upon Chinese goods, especially commodities. I have already seen one tenant start to default on their lease due to the supply chain issue. Parts of China have manufacturing shut down and aren’t able to produce and ship their products to US companies which is going to hurt US companies. Home Depot is sold out of masks party because of high demand but mostly because China decided to turn their ships around and keep all of the masks. That’s how powerful China is when it comes to supply chain.
The good news is that the US is realizing how dependent we are on China which may spur manufacturing to continue moving back to the US and possibly at a quicker rate. If the coronavirus continues to stagnate the Chinese economy, we will be forced to start manufacturing more in the US and Mexico. We’ve already realized this with energy and are now ramping up domestic energy production.
For right now I would expect to see Chinese commodities become tougher to find and prices will rise. Slowly, but at a quicker rate than a year ago we will see the supply chain move back to North America. I would also expect Mexico to see manufacturing and supply chain growth, especially since USMCA is in effect now and labor is cheaper in Mexico.
As far as the real estate market goes, I expect industrial to hit a small bump in the road, especially in the distribution market. I would expect manufacturing buildings to lease up and flex buildings to continue to lease and sell at a steady rate. I would expect the residential market to remain strong due to continued high demand and limited supply. This may even create a tougher market for buyers and new construction as a whole, because building materials could increase in cost due to the supply chain being choked by global coronavirus fears.
Max Fisher, Industrial Properties Broker