Retailers Need Industrial Space

A unique situation has unfolded in the industrial real estate market as we move through the year 2022. Retailers across the board are trying to adjust to supply chain whiplash and difficulty moving inventory by leasing industrial space. In Salt Lake City, the numbers tell the story of this situation through a continued  2% vacancy rate in our market. This makes available space increasingly difficult for tenants to find. 

The Salt Lake market has been very tight on space due to the robust Utah economy and the demand from businesses to ship goods to and through the state. The trend also exists across the country, with demand for space partially stemming from a “just-in-case” mentality rather than the “just-in-time” inventory method. The industrial market is on track to break records again this year. It will be interesting to follow the trends for how users change the scope of industrial real estate throughout the rest of the year.

Welcome IPG’s Two Newest Members

Industrial Property Group (IPG) is pleased to announce the addition of Camila Gomez as Property Management & Development Assistant. Camila will be key in assisting with both the development and property management divisions at IPG.  Camila will be working closely with Chris Delong, the Vice President and Senior Property Manager. She assists with managing the daily operations and maintenance, tenant relations, property inspections and preparing and tracking operations budgets and invoices. Camila will also support the development team with their construction projects. 

“I graduated from BYU with a bachelor’s degree in Political Science, with an emphasis in Public Affairs and Diplomacy. I am an experienced paralegal where I worked closely with attorneys to provide support on a number of high-priority cases and projects. As I learned more about real estate, I became particularly interested in Industrial and Commercial Real Estate. I am very excited to be part of the IPG team and to contribute on the daily tasks that allow our customers to improve and grow their business.”

Also joining the team is Jay Flynn.  Jay joined the brokerage team as an Industrial Information Specialist. Jay started as an intern for IPG during his last semester at the University of Utah and has moved into a full-time role with IPG. He will be focusing on assisting our Director of Information Services and the Vice President of Client Relations in expanding our knowledge of the market and in gathering data.

“I started out as a biology major at the U and as soon as I switched to Business in my second year of college I immediately zoned in on commercial real estate. I knew that it was the place in business for me and being at IPG has been a dream come true. I am excited for the incredible opportunity that this team has provided me. I am grateful to be around such poised and intelligent people. I know the learning opportunities are endless.”

Manufacturing in the U.S Continues to Thrive

During the pandemic, companies began a frenzy of reshoring, onshoring, and nearshoring and the trend seemed like it would trail off when things started to open back up worldwide. It was assumed that people would offshore again for production cost purposes and many companies would be back to relying on China and other countries for production. American companies this year have relocated their manufacturing either back to the U.S or close by at a greater rate than they did in the first six months of the pandemic. There are a few factors that go into this move, supply chain costs have risen so high that importing goods from different countries costs more than its worth, port bottlenecks have made wait times too long, and some companies are just looking to expand their capacity and want to do it on American soil. 

Construction for manufacturing facilities is reaching an all-time high as well, eclipsing last year's industrial building construction numbers and vacancy for these spaces is constantly shrinking due to the high demand for space. The key to making sure that the cost of production does not skyrocket in the U.S due to the strength of the dollar is to ensure that these companies are working efficiency into each part of the manufacturing process without compromising the quality of the goods they are producing. U.S manufacturing produces more jobs which leads to more money being spent in our economy.  It also means that in a time when the U.S is importing almost 80 billion dollars more goods than we are exporting, onshore manufacturing could help balance our trade deficit and allow for a boost in our economy as well. 

AI Integration iN Manufacturing

The world of manufacturing is consistently modernizing to ensure that the efficiency of production in a warehouse is maximized. Tim Hoj, CEO of Hoj Innovations allowed us the opportunity recently to host an executive event at his company's corporate office and warehouse. Hoj Innovations is a great example of a company that has pioneered aspects of manufacturing efficiency and helped companies save time and money in their warehouses. At the forefront of AI integrated manufacturing technology is a subcategory referred to as computer vision. This technology uses images from cameras and videos to identify objects and react to the images that computer vision is “viewing.” There are many financial, quality, and safety advantages to this technology with the following being the major highlights of its integration into warehouses. 

Computer vision is capable of automating payroll and onboarding responsibilities through automated document processing, furthermore, it is capable of processing invoices and controlling inventory management as well. This means that from the hiring process to tracking inventory management there is an automated system controlling the process with precision. Computer vision is capable of tracking quality standards through ultraviolet and infrared lights to catch mistakes down to the most minuscule detail. Last on the list of computer vision highlights is the topic of safety and using custom metrics, computer vision can track dangerous areas of a warehouse. It will track when employees are in high-risk areas as well as prevent machines from breaking by tracking the deterioration of a machine which allows workers to provide the proper maintenance on a machine before it breaks down completely. The integration of AI in manufacturing will be a long process but eventually could re-shape the efficiency of a business's production and save time and money in a multitude of areas. 

The Power of Courage

C.S Lewis defines courage as not one of the virtues, but every virtue at its testing point, a choice that each person makes when facing a decision that requires trust and a sense of adventure within yourself. We are living through a time period that requires lots of courage for a multitude of reasons, so interviewing the Executive Vice President and Partner of IPG Commercial Real Estate, Jeremy Jensen, SIOR, CCIM, about courage seemed like perfect timing. 

I asked Jeremy four questions about the topic:

1.) What, to you, makes an act courageous?

Jeremy: Courage is staring down your fears, face to face, one on one, analyzing risks and rewards, setting priorities, making a plan, and moving forward, with faith, in spite of any paralyzing feelings or emotions that come up along the way.

2.) How would you like to see courage used in the world?

Jeremy: I am very grateful when I see people exercise courage to do the right thing, defend the underprivileged, champion human rights, and love the seemingly unlovable. I love it when courage is used as a tool for making the world a better place.

3.) What is a recent act of courage you have witnessed that you admire?

Jeremy: I admire the courage I see in Candace Keller as she parents a special needs daughter through challenging days, sleepless nights, and a lot of unknowns. 

4.) How have you used feelings of courage to succeed?

Jeremy: I have found courage to be most valuable when I have clarity of mind and purpose to help me move forward in spite of my feelings. Mindfulness and meditation have been exceptionally good tools for defining the difference between real and imagined risks. When we truly understand our priorities and have a solid plan in place, courage is the tool that takes you to many of life's treasures. 

 Courage has the ability to change outcomes for the better and help people gain confidence in ways they have never imagined. As Jeremy said, it can be a tool to make the world a better place.