The Dayton, Ohio, industrial market experiences upside trends that last for short periods of time and downside trends that last longer than expected. “Experienced commercial/industrial brokers simply say the flat market could be worse and it could be better,” says Ron Smith, vice president with Coldwell Banker Commercial-United Realty Services in Dayton.

The predominant trend in the area is the emergence of government involvement in most projects of significant size. “In addition to incentives tied to job creation and growth, such as tax abatements, grants or training funds, we now have local governments purchasing land to develop or redevelop,” Smith says. In this case, local real estate and construction professionals typically become involved only to help with finding companies that are interested in purchasing or building on lots. Small developers sometimes purchase lots to create multi-tenant buildings within these government projects, but the majority of the land is purchased by small- to medium-sized companies that have been offered a package of incentives.

The Dayton market includes five major manufacturing plants affiliated with General Motors (GM). Delphi, which split from GM, also maintains several large facilities in the area. NCR, MeadWestvaco, Reynolds & Reynolds, Standard Register and Lexis/Nexis are dominant employers in the market, but few manufacturing jobs related to those companies are present. Warehousing and distribution for these companies and others is stable due to the intersection of Interstate 75 and Interstate 70 in the near north end of the market. “This is one of the largest 90-minute markets in the country,” Smith says.

The largest employer in the region and in the state of Ohio is Wright Patterson Air Force Base in the northeast. The Air Force Material Command is located at this base, but most private employment supporting the base is related to information systems that support inventory control and equipment maintenance.

Industrial/warehouse rates range between $2 per square foot for older, functional space to $6 per square foot for newer space with higher ceilings, more power and quicker access to the highway. The vacancy rate for all classes of industrial/warehouse property remains between 8 percent and 10 percent, with a good inventory of available land in all sectors for new industrial/warehouse products. Land prices range between $35,000 and $75,000 per fully developed acre, with the biggest price difference being caused by proximity to the highway.

“The area to watch now, and into the foreseeable future, remains to be the area between Cincinnati and Dayton along I-75,” Smith says. “Increasingly, the 50-mile corridor between these cities continues to be a single economic market as companies locate there to broaden their draw of employment from both metro areas.”

Warehouse/distribution facilities and a broad base of small- to medium-sized tooling and machining companies have driven development along I-75. Regional development companies in this corridor include Neyer, Schumacher-Duggen, Miller-Valentine and Danis. Large, nationally known developers have not come to the area, or they have assisted only in single site developments. “In a cautiously optimistic summation, the industrial real estate market in the Dayton region will remain stable,” Smith says.

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