The local office of a national real estate firm is seeking to up its game in the red-hot industrial market by more than doubling the number of brokers it devotes to the industry.
Orange, California-based Lee & Associates arrived in Indianapolis in 2010, via a merger with Harding Dahm & Co., giving the national player a presence in the state.
With 17 full-time brokers, Lee ranks seventh on IBJ’s annual list of largest Indianapolis-area commercial real estate brokerages.
But much of Lee’s leasing activity has been split between the office and retail sectors. The firm only allots two brokers to the industrial market, which accounts for just 15 percent of its business, said Scot Courtney, who manages Lee’s local operations. It has offices in Carmel and Greenwood.
That’s about to change, however. Lee is committed to bringing on board three to five additional brokers yet this year in an effort to increase its industrial work, Courtney said.
“Lee has national strength in industrial,” he said. “We want to take advantage of that. We feel like the opportunity is now.”
Founded in 1979, Lee has 56 offices and 900 brokers spread throughout the country, with 400 of those focusing on industrial deals. Nationally, industrial activity accounts for about 50 percent of the company’s overall revenue, said Jeff Rinkov, Lee’s CEO, during a recent visit to Indianapolis.
“We get a lot of inbound referral business,” he said. “We have so much client activity that wants to have a presence in Indianapolis.”
And why not, given the impressive metrics the local market is posting.
A record 8 million square feet of total space was absorbed in 2017. (Net absorption is the total square footage leased, minus the square footage of space no longer occupied.) This year, 6.8 million square feet is expected to be constructed, which would be the most in any year, a recent report from JLL said.
At the end of the second quarter, total vacancy stood at 6.7 percent, unchanged from the year-ago period, while 1.3 million square feet has been absorbed through the first six months of the year, JLL said.
“We’re in a, probably, 48-month solid run of really solid net absorption,” said Jake Sturman, a JLL industrial broker. “Last year was a banner year, this year looks like it will be a very good year.”
The strength of the local industrial market is not lost on Lee & Associates.
“Our motivation is to move full speed into that space,” Courtney said. “The timing is right for that."