OIQ_091521

September 2021 — Office & Industrial Quarterly — Page 21 www.crej.com INSIDE Market update PAGE 22 Development outlook PAGE 32 Capital markets PAGE 30 Demand is outpacing supply nationally, and in Colorado, the long-term outlook is bright Colorado is leading the way for industrial development activity and trends The markets are seeing a shift in the allocation of private and institutional capital September 2021 S ince the onset of the pan- demic in March 2020, online retail sales purchases have skyrocketed in the United States, with online retail sales increasing nearly 32.4% from 2019 to 2020, according to a pre- liminary report published by the United Nations Conference on Trade and Development. Beyond a simple increase in online retail sales year over year, the UNCTAD report also reported a 3.2% increase in the share of online sales as a share of total retail volume, with Forbes reporting that the pandemic may have accel- erated the growth of e-commerce by four to six years. For consumers, this has translated to an inexorable shift in the way we purchase every- thing, from goods to groceries to even cars. For industrial developers in high- growth markets like Denver, it has meant significantly increased demand for warehouse/dis- tribution space in both the traditional urban core as well as in areas with anticipated population growth in the future. Still, despite the mounting demand for warehouse space, there seems to be something of a disconnect between the need for industrial real estate and the poli- cies of communi- ties needing to be served, both in the Denver market and beyond. Too often, comprehensive plans generated by city councils and development committees fail to provide suitable land allocation or zoning to allow for future indus- trial buildings. This often translates to an uphill (and often costly) rezoning battle for develop- ers looking to build warehouse/dis- tribution space to satisfy e-commerce retailers’ needs. A salient example is the city of West- minster’s 2040 comprehensive plan, which is currently posted for Please see Page 33 Matt Trone Managing director, Cushman & Wakefield Community developers keep industrial on the back burner Joe Krahn Director, Cushman & Wakefield Joey Trinkle Senior associate, Cushman & Wakefield The Prologis Broadway Distribution Center in central Denver is a 143,000-square-foot Class A speculative warehouse, which broke ground this month and will deliver in second- quarter 2022. Prologis plans to pursue LEED certification for the building.