Armstrong & Associates’ report signals growth in warehousing

A new report from the consultancyArmstrong & Associates, Inc.(A&A) indicates that growth in domestic warehousing is keeping pace with shipper demand and will continue to grow.

According to A&A findings, the total U.S. warehousing market for 2015 will be $141 billion. Commercial warehousing will account for $65 billion. The Third-Party Logistics (3PL) Value-Added Warehousing and Distribution (VAWD) market segment will be $39 billion.

3 pl VAWD 20细分市场增长了2.5%14. Of the VAWD third-party logistics providers (3PLs) reporting to A&A yearly, three had gross revenue growth exceeding 10 percent. Overall, net income margins averaged 3.7 percent. Warehouse vacancy rates have reached a level in key markets where growth should improve in late 2015 and 2016.

A&A’s Top 60 VAWD 3PLs have 3,540 facilities between them with 763 million square feet.

“We estimate that there are 9,000 U.S. commercial warehousing facilities of size with 1.9 billion square feet of space,” says A&A president, Evan Armstrong. “The Top 60 have an average of 59 warehouses. The average size is 215,456 square feet.

Armstrong adds that Modern VAWD 3PLs all have significant transportation management capabilities.

“This report’s survey participants commonly have network transportation management and dedicated contract carriage (DCC) trucking operations,” he says.

Three-fourths of the participants have asset trucking operations including DCC. Over half of those with network transportation management capabilities have control centers operating with major transportation management systems (TMS) platforms. The participants use 87 percent of their total warehouse space for contract warehousing and 13 percent for public warehousing.

Commodities handled by the participants were split into 13 vertical industries. The largest was Retail & Consumer Products at 26 percent. Beverages & Food was 17 percent while High-tech/Computers accounted for 12 percent. The smallest vertical was Aerospace at 1 percent.

Revenues per square foot by industry and by warehouse size are included in the report.

According to a recent study by Prologis Research, evolving trade patterns, along with advances in technology and the expansion of e-commerce, reinforce the value proposition of core market locations.

A similar conclusion was made by JLL, which noted thatwarehouseoccupancy levels have reached historic highs, while expensive construction and labor costs keep new development sparse in many seaport industrial real estate markets.