Land values for logistics and data centre hubs doubled in 2017
The average price for large industrial plots of land of between 50 and 100 acres doubled last year from $50,000 to $100,000 per acre, thanks to increased demand for data hubs and distribution centres, according to a survey by CBRE. In an examination of 10 US markets, plots of between five and 10 acres, suitable for "last-mile" depots, cost $250,000 per acre by the end of last year, an increase of $50,000 on 2016. David Egan, the global head of CBRE's Industrial & Logistics Research division, said that demand is not likely to drop in the near future.
A worker pulls carts full of customer orders along the floor inside the million-square foot Amazon distribution warehouse that opened last fall in Fall River, MA.

Land fit for future fulfillment centers for the likes of Amazon and Walmart saw huge spikes in prices last year, according to real estate services firm CBRE.

In a trend largely stemming from the growth of e-commerce players across the U.S., some plots of land now cost twice the amount they did a year ago, the group found. This is especially true in major markets, including Atlanta and Houston.

In surveying 10 U.S. markets, CBRE found the average price for "large industrial parcels" (50 to 100 acres) now sits at more than $100,000 per acre, up from about $50,000 a year ago.

Industrial land plots of five to 10 acres, which typically house infill distribution centers for completing "last-mile" deliveries, watched their prices soar to more than $250,000 per acre by the end of 2017, up from roughly $200,000 a year ago, according to CBRE. Located in more bustling metropolitan settings, these warehouses must help retailers serve consumers closer to their homes.

To be sure, industry experts say that despite an uptick in construction of late, there's still a long way to go before supply aligns with demand.