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Demand for warehouse space surges as spending shifts online – Business Insider

Warehouses are suddenly among some of the hottest real-estate assets in the US.

The pandemic is driving up demand for these spaces, which are generally large, no-frills industrial buildings used for commercial purposes like inventory storage, data centers, and logistics hubs.

“Demand for good, old-fashioned warehousing has jumped exponentially,” Tom Stringer, head of site selection for the business consulting firm BDO, said in an interview with Business Insider.

Warehouse and distribution rents rose 5.6% year-over-year to an average of $6.68 per square foot in the second quarter, which is an all-time-high, according to the real estate service company CBRE. Meanwhile, warehouse vacancy rates stood at a near-record low of 4.7%, CBRE data shows.

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