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What challenges are facing the industry ?
Continued low vacancy rates among rental properties and rising residential property values . The low interest rate environment is believed to be coming to an end , so many investors are eager to trade into their property of choice . Rising interest rates are expected in 2022 as the Federal Reserve intends to phase out its bond-buying stimulus program by March and signaled it would raise interest rates more aggressively to combat high U . S . inflation .
JERRY GAMBOA
SVP / Commercial Banking Regional Manager , Exchange Bank
Treasurer , Sacramento Valley Chapter of NAIOP
What kinds of properties are hottest at the moment ?
… Multifamily is the clear winner from my perspective . We continue to see several new projects in the downtown area such as Mansion Apartments , The A . J . and ARY Place . In addition , adaptive reuse of former buildings into residential , hotels and other uses will likely remain active in Sacramento . Build-to-suit construction also remains strong , such as niche grocery stores as well as self-storage properties and smaller residential in-fill development .
How is your service as treasurer of the Sacramento Valley Chapter of NAIOP going ?
I ’ m honored to serve with such an experienced and knowledgeable group of people . I look forward to helping our chapter grow and prosper in the coming year . NAIOP is a great organization for those working in the commercial real estate industry . NAIOP is comprised of more than 15,000 members and provides strong advocacy , education and networking opportunities .
What does 2022 and beyond look like from your perspective ?
Overall , the market is as strong as I have ever seen for both tenants looking for space and capital looking to invest in industrial real estate . The most concerning trend is inflation of construction costs and construction material supply constraints . Dock equipment and roof material are six months to a year out and this does not seem to be easing . Clearly the pandemic bottleneck has not subsided and industrial development has accelerated . … I think it will take all of 2022 to get back to normal . … The industrial market will continue to be red-hot and we will see a record number of build-to-suits at costs similar to high-rise office buildings .
TIM SCHAEDLER Partner Panattoni Development Company
What ’ s on the docket for Panattoni ?
We have our new park in Roseville … that is going through entitlements . Panattoni Park Roseville is 236 acres at 6382 Phillip Road that will include a range of industrial uses , including light manufacturing , warehousing and distribution uses totaling up to 2,430,000 square feet . ( We ’ re also developing ) Panattoni Natomas , ( which is ) 185,000 square feet , and Panattoni Rocklin , ( which is ) 250,000 square feet .
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