The Milwaukee industrial real estate market is in relatively good shape, compared to other markets, due to a small amount of speculative overbuilding in the last cycle, according to James Barry, president of James T. Barry Co., Inc./Colliers International. “Industrial development is just in the beginning stages of recovery with several new projects on stream,” Barry says. “Developers are still waiting to see evidence of sustained positive absorption, which should occur.”

The majority of development, which is primarily for warehouse/distribution tenants or light manufacturing companies, is occurring along the Interstate 94 south and west corridors due to available land and freeway accessibility. The Oak Creek/Airport area continues to be active with several new buildings under development including a Capstone Quadrangle building. The I-94 west corridor also is experiencing strong interest and should see increased activity with an economic recovery. Also, the city of Milwaukee is proceeding with plans for the development of an industrial park in the Menomonee River Valley, which is adjacent to downtown Milwaukee.

The industrial vacancy rate (6.9 percent) is low relative to other markets, and space is continuing to be absorbed with rental rates ranging between $2 and $5 per square foot triple net.

Recent major developments in the area include a 102,500-square-foot project in Oak Creek by Capstone Development; a 100,000-square-foot project in Oak Creek by Opus North Corporation; and a 100,000-square-foot building on Highway J by Briohn Builders.

New developers in the area include First Industrial Realty Trust, which has returned to the Milwaukee market and is considering several projects; Capstone Quadrangle, which is venturing into industrial development after several successful office developments; and De Mattia, which is also looking at several new projects in Milwaukee.

Some major leases that have been closed recently are DCI’s lease of 150,000 square feet of space located at 5700 W. Bender Ct., and Sellar’s lease of 100,000 square feet of space in the Marconi Building, located at 6565 N. 60th St.

“We expect 2004 and 2005 to be banner years for Milwaukee’s industrial real estate market,” Barry says.

©2004 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.