Upbeat Outlook for Industrial Property on Long Island

Jeffrey Schwartzberg, senior director of the Lake Success, NY-based commercial real estate services firm, Sutton & Edwards Inc./TCN Worldwide is upbeat about industrial real estate in 2006. He sees vacancies dropping, rents rising and sales prices climbing.

Lake Success, NY (PRWEB) February 8, 2006 -- The Long Island industrial property market, having completed a positive 2005, is poised in 2006 to see vacancy rates drop, rents climb and sales prices continue upward, a top industrial broker in the two-county region said.

Many of the pressures of 2005 affecting supply and demand — an eastward migration of business, strong business climate, low interest rates and shrinking inventory — remain intact, Jeffrey Schwartzberg, senior director at Sutton & Edwards Inc. /TCN Worldwide, told a Feb. 2 meeting of the Long Island Metro Chapter of the New York State Commercial Association of Realtors. “As companies continue to wait and see what happens to sales prices, this well create additional pressures to increase lease prices.”

Moreover, he said, “As long as interest rates remain fairly stable and the business climate remains somewhat positive, sales prices will continue upward, though mildly. He said the baseline price in Nassau County is $100 per square foot and $80 in Suffolk County.

He noted that investment properties are in big demand and quick, all-cash closings are taking place and that the biggest landlords have little space available for lease.

“Long Islands biggest industrial landlords — Rechler Equity Partners, Long Island Industrial Group and Heartland Business Center — have no significant space available to speak of,” the Sutton & Edwards broker said.

Moreover, said Schwartzberg, “There is enormous demand for units under 10,000 square feet with good access and loading.” Smart landlords, he predicted, will continue to subdivide their larger buildings to accommodate this demand. Also, he noted, landlords are raising the ceilings of their properties as more companies understand the concept of cubic space and height.

Schwartzberg said he sees additional construction of big box developments in central Suffolk County, where companies, such as Quality King Distributors and Intercounty Appliance Corp., respectively, are constructing 500,000-square-foot and 250,000-square-foot distribution facilities.

Meanwhile, he said, “Nassau County is loaded with dysfunctional, but attractively located properties. Dysfunctional buildings, he said, have ceilings of less than 14 feet, poor or no loading, poor accessibility for trucks and are filled with columns. In addition, he said, there is no land available in Nassau County for new construction.

Founded in 1962, Sutton & Edwards Inc. /TCN Worldwide is Long Island’s largest commercial real estate services firm. Headquartered in Lake Success, NY, the firm employs 50 real estate specialists providing integrated leasing, investment sales, property management and advisory solutions. To find out more about Sutton & Edwards, please call 1-516-328-6500, or visit the firm's web site at www.suttonandedwards.com.

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