April 12, 2022
Joe Fairless

JF2779: Why Now Is the Time to Break into Industrial Real Estate ft. Chad Griffiths


Industrial real estate broker and investor Chad Griffiths stumbled onto the asset class he now knows and loves by complete accident. When he joined a company as a broker in 2005, his mentors were heavily involved in industrial real estate, so he naturally ended up learning all about it. Today, he is a partner at NAI Commercial Real Estate and invests in properties as well. In this episode, Chad discusses the state of the industrial space across various markets and explains why now is the ideal time to get in on it.

 

Markets with the Highest Industrial Growth and Demand

As e-commerce continues to grow, Chad predicts a considerable demand for industrial real estate — particularly warehousing — in the Rust Belt. He also predicts a resurgence in manufacturing as a result of current supply chain issues. There will likely be more resourcing or on-shoring for manufacturers in order to start making things in North America. “I wouldn’t be surprised if we actually see distribution spaces and manufacturing spaces continue to grow for the foreseeable future,” he says. 

This growth is happening the strongest right now in port markets like Los Angeles, New York, New Jersey, and Vancouver, Canada. These markets, Chad says, have less than 1% vacancy, which means we’ll likely begin to see vertical growth in the form of multistory warehouses. He predicts this growth will spill over to inland markets like Chicago, Dallas, Kansas, Ohio, Pennsylvania, and Tennessee. 

 

The Best Opportunities for New Industrial Investors

If you’re looking to invest in industrial real estate for the first time, Chad recommends focusing on areas experiencing a positive population influx, like the Sun Belt — particularly Florida, Texas, and North and South Carolina. “My number-one area that I’d be invested in right now is Florida,” he says. “I think that there’s so much happening in that area. I don’t see that market declining anytime soon from a population migration standpoint.” 

 

Why Manufacturing Development Indicates Population and Job Growth

Regardless of your chosen asset class, Chad says that watching where manufacturing is being developed is a lead indicator for population and job growth. Because manufacturers often pay relatively high salaries for skilled laborers, they naturally spur this kind of growth wherever they appear. That's why he expects to see an increase in both population and job growth in the Rust Belt next.

 

Chad Griffiths | Real Estate Background

  • Partner at NAI Commercial Real Estate. He’s an industrial real estate broker and investor, focusing on cash-flowing industrial properties with the goal of incrementally raising rents and values by extension.
  • Portfolio: 
    • GP of five industrial properties ranging from $400,000 to $4,500,000
    • Owns several industrial REITs in the U.S. 
    • LP of one multi-tenant office/retail property
  • Based in: Edmonton, Alberta, CA
  • Say hi to him at:
  • Best Ever Book: The Bomber Mafia by Malcolm Gladwell
  • Greatest lesson: There are asymmetries in real estate knowledge, so the person with the most knowledge has an undeniable advantage.

 

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