The demand for industrial properties will continue to stay strong in the Baton Rouge market during 2014, a speaker at the annual Trends in Real Estate Seminar said Thursday.
More industrial service companies will enter the market because of the boom in petrochemical plant projects, said Scot Guidry, with Mike Falgoust & Associates.
“While the industrial economy remains beyond robust, you shouldn’t bank on announcements alone,” Guidry said, noting that many megaprojects that have been announced haven’t panned out exactly as expected because of outside influences.
The vacancy rates for industrial space in the Baton Rouge region has consistently dropped for the past four years, reaching 9.3 percent at the end of 2013, Guidry said.
That’s because speculative industrial construction projects remain limited.
And the speculative building that has broken ground in hot areas, such as Airline Highway in Baton Rouge or La. Highway 30 in Ascension Parish, the size has been less than 15,000 square feet. “You’re talking $1 million for those kinds of projects, so that’s quite a mortgage,” Guidry said. “It’s risky building 100,000 square feet without tenants.”
About 700 people are attending the Trends seminar at the BREC Independence Park Theater , which features local experts talking about current and forecast trends in various sectors of the real estate market, including single-family residential, multi-family, office, retail and industrial.