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how many years in the business just around right now yeah so uh it's amazing how uh how fast it is a lot of changes uh in our in our time and really over the last couple years so we've got a um a slideshow that we'll be uh loosely referring to as well and we're happy to take any questions after our presentation but we can go ahead and get started with that um you know industrial real estate um has really just blossomed and i mean it's become the preferred out that class along with multi-family um you know most of my career we were just sort of the uh you know we were just the warehouse people um just doing our thing well now all of a sudden uh industrial real estate has really stepped up uh to meet the demands of what our what our population is trying to accomplish and certainly a lot of things from industrial real estate came out of covet um but even before that things were in motion um some buzzwords that that we continue to hear um e-commerce supply thing uh safety stock all of those terms are words that we hear and have heard all day every day at conferences we've gone through the years but all of a sudden has become national news and it's it is a real thing industrial has become is becoming the new retail um yeah you guys probably remember during covet you know there was a shortage of toilet paper and that direct result of supply claim disruption which really came to the forefront you know in april of last year so in uh in quick numbers um in 2020 about 20 of all retail sales were online and i think to the average everyday person what they may or may not understand what that means to our world if that simply means that that product that you are ordering off of the internet comes out of a warehouse it is not necessarily or ever coming out of a retail store so that is why the demand for industrial has become so uh so important and as you can see kind of clearly there's a long runway for e-commerce sales to to to happen um as a comparison in the asian market their retail sales are 50 online compared to our 20 so as we look at sort of uh some of the industrial trends that were related to covet uh you know there's there's obviously a pause really march in april of last year you know businesses were talking about revenue and q1 and moving down 20 and 30 and as you must remember you know the whole world basically put on hold for that 60-year period but as may fur rolled around and his state homeowners were still in effect there was a significant serve in online sales and that's really the precedent coming out of kovid that there was this compression to purchasing things online and that really been the story for the remainder of the eight months of 2020 and we can talk about you know some landlord concessions that occurred in transactions that were happening in march and april and may traditionally there would be rent free rent we saw some free rent increase during that nine day period it's all annual like escalations and transactions decreased but again kind of after that may be first late more concessions basically evaporated from the market yeah so we uh we have seen acceptable commissioning that there was only a short lift and it really wasn't necessarily uh the climate demand issue was more of how do we move forward in the in the world that we're living in now and it caused a little bit of a uh of a backup in demand so in some of these uh issues on the supply versus demand we say that the charlotte market everything but it's a u.s issue as a whole uh you know another big theme um nationally and even locally is that bigger is better the size of the buildings that are getting developed and talked about are are getting bigger charlotte for a really long time was just a bread and butter regional market that served you know a local population consumer driven market yeah exactly the deal sizes were reflective of that where you know people would ask how big is your market and what's the typical deal size you would say you know 75 000 to 150 000 square feet and on the slide here we're showing bigger is better than the top line we've seen that deal with price increase blood rob well i think you know we can kind of skip over to the regular development um in 2015 97 stack buildings were delivered of those 18 river 300 000 square feet all of a sudden in the charlotte market we have never seen in our careers there is a lack of supply that would call it 300 000 square feet warm and the developer that we're talking to which is an unbelievable amount of folks trying to get in this market we're telling them if you can put up a 500 000 to even a million square foot spec building it will lead to an e-commerce either probably in seven months or less and you may be asking well how or why is that well charlotte for one is serving a population bank it's growing by 19 people a day um also our interstate and infrastructure has become you know a regionally based important um outlet with i-77 i-45 and i-85 as uh as reproducing chains so you know not only are growing from a population date but we're also an important piece of the supply chain bringing products to and to and from um you know part of the other supply versus demand interviews as we talked about the bigger buildings we call those or generally refer to those as prop docks it's a building that has docks on both sides of the building and um as opposed to the rear load product there's a glut of rear load product on the market that will be absorbed but these crosstalk are what's extremely sexy right now um as far as like buildings to perfect both from an investment standpoint in a user standpoint there are almost none available um if you wanted to buy a building right now it is a seller's market 100 this is a product type that we see a lot of you guys about and you know just to confirm the transactions and you know right now if you do a search in your county or mecklenburg county you know there's less than a handful of buildings available for purchase right now and historically over the last 12 months you know there's been competition on each one of those transactions and so the buildings were waiting for was the purchase price and you know those so same building we're on the market in 2018 you know we're seeing a premium from anywhere from ten to twenty dollars a square foot increase in price in just one four months yeah the quality of the building is not uh indicative of the price per square foot exactly i mean there are 40 foot buildings 40 square foot buildings in my opinion five years together going for over a hundred dollars a foot now simply because of this live constraint so from the u.s outlook um you know the absorption numbers are in our world fairly fairly staggering um 274 million square feet absorb that's 18 higher than the year before afternoon rents charlotte specifically for almost my entire career saw this stagnant written growth again landlords market from a supply and constraint the rates are going up and and that rate increase really what rob's referencing kind of that ceiling at 450 475 a square foot for roughly 20 years it broke the ceiling in 2018 and since then you've seen these you know eight to three percent annual increases in price per square foot asking ranks so the vacancy rate uh right now uh fluctuates and um these numbers we're seeing right now about five and a half percent may fluctuate even up to nine percent but that's simply based on the delivery of a product a new speculative product coming online exactly you know and the charlotte market now um for for all intents and purposes is basically you know rowan county all the way south to uh york county and west to gaston and lincoln county their spec projects and all of those sub markets which we now consider garlic um you can see from that last last flip that there were 339 million square feet under construction in the us which is three three four percent higher than even before that last time we uh we were together justin and i i think we were referring to it as amazon effect and i think at that point even just a couple of years ago it was something that we were keeping our eyes on i didn't really quite know how that might affect the industrial real estate world well obviously it's defining the industrial real estate world um as you can see from the top 10 occupiers all of these occupiers are at this point um servicing e-commerce platforms amazon is the top occupier in the uf 80 almost 88 million square feet um those first all of these these first five names are big names and uh brand names in the country and home depot is the second behind amazon at 6.1 million amazon occupies 14 times a square feet of home depot and home depot is one of the most active tenant in the market in the u.s and as you can see uh from charlotte occupiers uh as compared to national it kind of sells the same story amazon walmart loads home depot um fedex all those top names are in this market um not leaking one or two buildings to look in the league's three four five buildings of you know big size half a million square feet long we put this slide in to really show more that um charlotte is kind of making the top 20 or so in the top markets but i think what we're trying to get across here is at the southeast in general um three of the top growth markets three of the top five growth markets in the country are in the southeast uh two of those are port cities um so you know the south is benefiting immensely from a lot of things frankly coveted the business structure that goes on offered here so you know the theme a lot of the theme that we're going to hit on today is a long runway that both the south has in industrial real estate how that's all coming together so just a you know quick charlotte market overview um you know this is the slide that you can alter see on co-star if you guys subscribe to that but you know again the story here is that you know 2018 you know the asking room in the warehouse probably had a four in front of it and today it's north of six dollars a square foot you know historically the absorbent square footage in our market around a half a million square feet a quarter and that's been true for probably the last three years but we continue to see that absorption square foot number increase significantly year over year and you know one thing to take a look at when we talk to people all across the country they say well you've got you know 1.7 million square feet 1.9 million square feet you know over 3 million square feet under construction or new construction and one thing to take into account is rob mentioned in rowing county down to york county you know the drive time is for tractor trailers over an hour and a half you know to procure those new locations so if you break that out in the sub markets it doesn't appear to be such a dominant square footage historically the airport some market in the southwest somewhere charlotte have held the largest you know under construction uh or speculative development yeah and you know from those numbers you can kind of see where absorption meets the new under construction so i've heard someone mention that um no it doesn't happen as quickly as this but there's a there's a space for every tenant that needs it has always been a really sound fundamentally fundamentally sound marker which remains so also why we're getting a lot of attention from institutional grade capital developers and one thing you look at those numbers again right now our collier's office is cracking around the seven million square feet of potential deals in the market and those are considered deals where paper is currently being traded and so you know seven if half of those wheels hit you know that would equate to similar absorption in the 30-21 as you can see you know absorbed in numbers and abortion by square foot you know continue to increase and we've we go back to that kind of 2017 2018 landscape and you can see that was the first years where we just saw strong absorption and rent growth starting in those years a lot of those transactions on the next slide we can kind of break out to you know where they occurred so you see the iredale some market you know the airport west sub market that we've talked about and rob can speak to the with the absorption there in irondale county with the household name that occurred at the end of the year that building closed what in december yes at walmart uh walmart's a million square foot spec building which you know first and foremost we generally thought that someone putting a million square feet of speculative base in troutman was borderline and sing and lo and behold you know household name takes it and it really does show really that that deal i think besides all the amazon you know really solidified the story of what commerce is doing for the markets and this is you know this isn't a walmart million square foot building that just served like an entire coast i mean this is like regional right you know north and south carolina types type types so that that building was built speculative by catholic godly in our market and it's sold for 68 dollars in december of last year there's some other notable transactions we've talked about the airport web submarket so that's you know that's 485 from 85 down to 77. so you know on a clock you're returning you know 12 o'clock down to 6 o'clock on the western side of charlotte you had three or four notable transactions a company that's a supplier for home depot took three hundred thousand square feet in a building that was speculative being built on took 600 000 square feet and another logistics company took over 100 000 square feet and then there was the york county absorption and rob can speak to you know there was a significant amount of supply coming online in your county and all of a sudden it was just evaporated in the last six months of last year again uh the tenants that absorbed that space generally speaking um e-commerce driven as well um amazon i can't if we mentioned this earlier but amazon occupied about four four and a half million square feet in charlotte market i don't know if you guys saw the business journal last night colin announced that there's going to be another 150 000 square feet at the intersection of state for 115 on the north side of darwin which is an interesting point because you know we mean at least now we knew that deal was in the market rumored we think there's another deal similar to that in the market these are sites the developers were fully planning on putting you two and three spec buildings on where now amazon is taking full sites for you know whatever their needs are their fulfillment or their delivery so it's it's really fascinating to watch how what we call the amazon effect really take place um some of the other things that we can talk about um from a charlotte standpoint um the manufacturing is you know it's it's it's stronger but it's still having uh i think labor issues kind of drive where the manufacturers go this is a very tight labor market in charlotte and surrounding um charlotte mecklenburg proper uh not real need on giving incentives to industrial losers as to say south carolina so we tend to receive more development on a distribution side of things than um than manufacturing you know from a land basis uh we've hit on this already that the charlotte market is really growing um you leaders still want to stay and hug the interstates so you're all off of 85 77 45 that's going to be a a popular site but we've expanded our searches for developers again to row in your gap in lincoln county's perspective which i think historically would have been um built to suit hold sites um yeah yesterday we were on the phone call with a national developer they acquired an app that in q4 of last year from google partners with the 200 million dollar transaction we'll mention it later but they told us on the phone yesterday that they purchased over 1500 acres of land in 2020 and that just shows there's a huge land grab going on right now and from a perspective standpoint you know developers were paying you know 50 to 75 per square foot for entitled land with utilities in the kind of four and five peripheral and today you're seeing those prices across the board jump to 150 000 per acre if if there are available sites in mecklenburg county yeah and they've shipped um is going towards 85 and service brings the whole corridor between now charlotte greenville bartenberg atlanta from the north to richmond and um so 85 is uh is becoming more popular than it was i think that 77 was the darling for a while still is but there's just limited hikes along i-77 until you get you know kind of north of statesville um of interest to you guys um you know sales sales are tough uh right now um there really aren't any quality or uh or even what i would consider deals from a marketing standpoint that really go out anymore i mean what we do day-to-day when we have institutional types or any kind of investors that say we're interested in in buying industrial real estate we were literally just picking up the phone and calling owner to see if they would sell and more likely or not that their response to us says we're not sellers we can find anything let us know so it is really difficult to even just manufacture a sale right now and very rare that someone puts a package out um that we can something a little bit of a big partners deal right um that's something really hard to find right now from a user standpoint as we said you know one example uh it's a small example but justin and i have a 20 000 square foot building from an i-85 that is was built into the 60s um i mean there's no good frills to it whatever right it's probably one of three buildings available period and the lack of supply is is just unbelievable even though interest rates are low it's an environment where users can be able to take advantage of it in investors but it's just worth right and one quick other example to kind of combine that land and sales and owner occupier conversation that rob mentioned i'm working on a transaction in mecklenburg county where we're going after 25 acres of land on the land that's multiple buildings in those buildings most of the occupier for tenants but there is a primary one of the buildings has a primary business that influence is very successful but you're having a developer going after a people land that intends to tear the buildings down so part of the transaction is that one of the occupiers has to find a building to relocate into but when he's looking he's getting top dollar for his building but he's looking at the available buildings and it's robbed with reference they're mediocre quality and he's having to pay top dollar on that downstream acquisition so we can just see how transactions are becoming more and more difficult and the timeline to complete the transaction is continuing to be extended this is for another day um but if we are going to talk about something that we see maybe in the future feature is when are we going to start seeing older industrial buildings being demolished for either new industrial buildings or other uses um it wasn't something i thought was coming anytime soon and then i got an offer on a building that was uh built in the 50s in the kimway industrial park last week that a developer wants to tear down so that they can do credit parking for a 1450 company so that may be coming um from an industrial standpoint the other kind of sector that we deal with is uh along the lines of what i was just referring to but specifically in south end or modoc are some of the uh the industrial buildings that are becoming honestly from an industrial standpoint probably have already been presented there along with light rail and are becoming multi-family sites the pricing and the fervor for multi-family along these former industrial areas is just as broathy as as industrial real estate development amazing so we you know we had we had to kind of put on a different hat and learn how to be multi-family developers when we do business in the southend area um developers are literally negotiating against themselves i've got a client doing some real estate in southend about three acres and one group has made three offers with no responses each time we found the numbers going up you know ten to fifteen dollars a square foot per way input so you know that that is the other really fascinating aspect of darling is the is these older industrial areas are multi-family or office uses yeah we i mean quickly capital markets you know we've touched on this slightly but as rob mentioned you know packages as we call them they're coming out the market by the investment sales teams at ubere or jll you clean those markets shut down for what we consider march april may of last year again that june 1st date these markets opened back up that was available you know we knew that the pricing was kind of holding water on the industrial front as well as multi-family front and it was you know somebody turned firehose on um so charlotte all just some incredible investment sales last year you know led by the beacon transaction that we referenced um but i think you know overall you can see there's you know there's an enzyme effect you know there's the absorption and you know we're continuing to see evaporate compression as part of the theme we're really lucky to be in the south and southeast um we're really benefiting from you know what i say are just real life and we're not these aren't just things that are we're talking about trends i mean these are real life things that are that are running businesses from a development standpoint we have an enormous population growth going on here um as well as you know particularly the entire south florida georgia alabama technician it's really unbelievable um from a um kind of segway from the capital markets the cap rates specifically in charlotte the cap rates here on certain asset classes like clat day industrial have kind reached national levels um i think that for a really long time charlotte was more of a safe haven to try and find a wheel so to speak where cap race might be you know even in the sixties for class a um type type wheels but we're starting to hit uh for new construction and development um with that credit on a lease standpoint national type um cap rates that i would say are like five and a half and under yeah as folks have gotten price out of you know the larger markets the last five years they've started to work in charlotte and that is you know exponentially changed in the last 12 months yeah really in the last six months i mean charlotte's on everyone's radar from an investor charlotte as a whole was doing most things right from the airport to how we are yeah our infrastructure we tell a really good story from a national standpoint which leads into there were some sales last year believe it or not and some of those sales have high water marks mainly speaking metroline industrial park which was developed by uh vegan partners um beacon chase with landsite for a really long time literally 20 years in a very land-constrained market which is uh basically sunk red off of uh exit 16. it's the old metro and fairgrounds exactly for you about the location they built uh they built 1.9 million square feet basically wreaked it all off uh they took that to market they had 40 offers and two who when a deal comes to market you have to subscribe to the offering memorandum and so they had over 200 people sign up for the offering memorandum and drive reference they had over 40 offers and typically you know say okay offers call for offers on a specific date and then you whittle it down with probably three different variations to get to your best best and final but at 40 offers it went through multiple multiple iterations to get them yeah and clarion was awarded the deal and so for example you know 200 million dollar sales price you're clearing on putting somewhere between 150 million dollars in debt down and they're amortizing that debt over 25 years and they've got an interest rate that's two and three quarters so when you look at the cap rate of you know just above four when you still are you're getting a spread of little over you know two percent and that's what these guys are chasing which is quite surprising in our market yeah and uh you know one of the things we don't have on here necessarily the legacy park at least was a deal that was actually occupied by a company called hurt but what we don't have on there is effect you know buildings are being purchased also from a speculative developer selling to another developer and like there were a couple of buildings within legacy park east and in rock hill and sold to silverman who's a big name now garland that's another story the clarion park which was one of those was half full they bought it for 86 square foot so a couple of deals happen but you know yeah airport exactly that airport south building would bought fake in it but i think the you know the story was metrolina at a record per square foot sales price plus uh record cap rate you know just about so um you know trends for the future um from an industrial real estate perspective um you know are we gonna see things like electric vehicles that uh are more sustainable amazon may lead the way for something like that um land land is becoming increasingly more fierce again we're kind of hitting more like we've said our market is growing outside of the charlotte msa so what we're calling the charlotte is faster different than what we called it two years ago land perspective from a building perspective it's an incredibly hot market the amazon effect is just full on and it's uh from a competition standpoint uh you know sites are getting gobbled up buildings gobbled up and they're competing with the big names of the world lowe's repo stuff like that so you know that they are driving what we're seeing is the real estate these days yeah and another factor of that is you got likely seen the building that amazon just finished at the intersection of 485 and 85 when you're heading out of downtown charlotte it would be on your left or on the south west corner anyway amazon not specific to charlotte they four or five years ago and started occupying at the building with a million square feet they would move into half the building prior to the building being finished so you guys may have seen that in carla where they were loading out of the you know the right side of the building when the roof wasn't even completed on the left side of the building and so people like fedex and home depot that's a completely new phenomenon to them uh where amazon is continuing to set the trend and we also talked about delivery times and you guys i'll see when you purchase something online we talked about you know bigger is better you know three years ago this wasn't really in our uh you know quiver but today you know cross stocks with their abilities to load on both sides and the average lease up time is seven months on those and so that's a building that's 300 to a million square feet where a developer is building that speculatively which is just quite new to the charlotte conversation and then you see maybe you guys are reading in some of the you know article nationally that you know home depot target some of even these retail folk like kohl's and lacy penny where they're closing some of their stores but the stores are well located so they're converting those boxes that were formerly big box in retail use this they're converting those buildings to last mile delivery station to keep up with their e-commerce online storage demand i know rob mentioned it as well as you know what's the next sub market and kind of following along the i-85 corridor and we both believe uh east charlotte you know think alabama road from an available lane standpoint is probably the next pioneering opportunity for developers to start focusing on in garland yeah i mean we're basically the build it and they will come type um thought process so um yeah and a lot of this you know conversation has really been accelerated by the trends coming out of coba i mean what i think the biggest takeaway is that those 60 to 90 days when the whole world shut down and then it opened back up the conversion of people purchasing product online what happened in five months without code it probably would have happened in five years that's how quickly the world you know again just to just to break it down from a very simplistic standpoint anything you're going to order online comes out of the warehouse so we're pretty excited to be in the industrial real estate world visits uh there are other sectors who are not having as much fun right now as we are unfortunately but you know we felt like we were that way for a really long time so um that's our uh that's our presentation so um vanessa everybody's got any lessons we'd be happy to try and answer yeah i know thank you both so much um you know also the graphs are just you know i love how they spell everything out um i we did have a question with regard to land but i know that you guys already kind of spoke to that um you know just i mean people are just going further and further out so you know you said they're looking at rowan and going up to troutman and kind of looking at sites they wouldn't have considered a few years ago is basically what i understand from that so yeah basically the mecklenburg county sites have all been put over and they've been picked over for specific reasons they have topography issues and wetland issues you know they're zoning or rock hill for any other reason except for their rock down there in the ground so your county has some challenges on the available land sites that are off the island so you're just seeing developers venture out but when they do that you know they have challenges with utilities and it's the local municipality going to flip the bill to bring utilities to this site particularly a warehousing box you know creates 300 maybe 500 jobs you know amazon at p can create a thousand so is the local municipality going to spend the dollars to bring utilities to a site that's only going to create 300 jobs and a lot of times the answer to that is no so these are just some of the challenges related to land that we're seeing you know across the region and you know as we can say the amazon effect will be effective amazon's having all of its competitors is they want to get away from the amazon because of a labor standpoint um amazon pays well some of these other companies may not pay as well so they're going to try and be far away from an amazon distribution center as they can so again that's where we're seeing this just really the spread in in geography and uh so um and it so would you guys also maybe just speak to how does raleigh compare to charlotte are you seeing these similar trends there and yes so in raleigh's been more of a life sciences occupier you're obviously familiar you know for 20 years now you're familiar with the research primal park and you know that occupies roughly in between raleigh and durham which is morrisville which is right at the rd group airport and so that's it kind of the northwest quadrant of raleigh and you know again over the last four or five years raleigh has transitioned more into a distributed market so they're spreading out so the 540 corridor you know in apex kind of in the southwest corner down the gardner in the southeast and night rail you know which is duty for raleigh are all benefiting because of available land sites and amazon has just opened up a site in nightdale slash gardner which was at a former you know manufacturing factory um and related to pricing historically the raleigh bureau market on a warehousing rate has always been about a dollar per foot higher so our industrial rents around six dollars you know there's around seven you know on the flex aspect they're usually around two dollars a square foot higher because there's a lot more infrastructure related to those like sciences that we've mentioned but they're they're raleigh is absorbing and seeing some of the same dominions that trauma you know a lot of that's across the southeast you know down down into florida and out to texas well i think you know raleigh started to see that same saying what would one considered not raleigh is now raleigh and i think a lot of these bigger developers they look at like say atlanta atlanta you know 90 miles from the obd of atlanta if they come to charlotte they're like you know this is right off 45 it looks great same in raleigh it's like you kn w i think we tended we didn't have a myopic view of what our sub markets and our markets are and these larger developers are like wow i mean this is right where we want to be so raleigh's saying the same thing um land prices are deeper outside of the dvd and so [Music] i'm happy to try yeah yeah so um we've got so um have you started to see interest from the automotive industry for more space for storage of vehicles in industrial parks or warehouse space um in charlotte not necessarily i think that's probably more of a maybe a work related type question um i don't think that we're going to see a lot of uh warehousing for auto maybe park and stuff like that but not the actual cars the trucks themselves i think those are going to be offloaded at ports and on their way that way there would be a rain over truck oh hi does that answer your question kelly okay and then um and so and then we had another question is there any way that land can be found to build the smaller ten thousand to thirty thousand square foot structure there is um and there are sites available but you know a lot of the capital that gets deployed they really need to have they need to have the mass to put the capital where it needs to be and um some of these smaller buildings are just not going to get the returns that the developers want i mean i could say that's probably gonna be better suited for an end user right uh to purchase themselves but from the spec basis um you know the rate you know the land thighs would just be so small that they can't get a there are available sites there now they will have challenges i mean you may have to if you're building ten to thirty thousand square foot you typically think you can fit that on you know an acre to an acre and a half but that means you've got to have you know an acreage and a half of buildable land and finding that today means you're looking at larger spikes just to zero in on that buildable uh or usable recreation and back to kelly's point you know carvana is doing this you know at the former philip mora site in bavaris county you know they're in roughly they took a portion of an existing building and they are building a smaller building but they're these kind of intake centers where they bring in large amounts of car and basically clean them up throw them on the internet and then these cars you know sit kind of out of view to the local consumer until someone purchases online and then carvana you probably see their truck they they throw deliver it to your front door um so i think they're leading the way in you know that conversation and then there's some of the south boulevard dealership that spilled out because they're quite frankly out of land that they're losing viewerships i think there's another question about ipu scrolled off uh i think yeah the piercing of oxymoron county so that's a really good question um yeah it's probably a two-part question there i too and then you know where developers migrate so from a distribution standpoint the i2 versus i1 is not that big of a deal um from a spec basis because generally speaking those users can could go when i want and that's going to be what most of the sites are yeah i took that food sites or generally at this point the older industrial areas that are seeing ranges of use so i i would say that the developers are not as concerned about the i2 whereas the users of i2 were really concerned i mean they're getting priced out and moved out basically and to some of that the benefit i mean we've got a client that and 10 acres and node off with an end user and they'd love to sell but they can't find a replacement uh anywhere in charlotte period so that's a dilemma we're like please fell so we can have something to do um but we can't find them their replacement uh for their use that too is becoming very challenging um you know we will get request for hey we need 20 000 feet on five acres and we're like get in line yeah um manufacturing uh you know distribution construction you know i would say you know that's pretty heavily weighted for distribution and what you know there was a deal done in york county last year it's a hundred and two hundred thousand square foot deal with the rear load box a manufacturing company went into so manufacturing groups are finding a way to take these you know rear load buildings warehouse distribution buildings and convert them to manufacturing sites now specifically with that transaction the reason why they took that building was because there was a power station you know literally next door so they needed you know extreme amount of amps i can't remember the number but um that was really the only building in the market that met their power demands that was the arrival deal that you all may have read about in the charlotte business journal which is an electric bus manufacturer do we have any more questions anyone want to ask justin rob a question or um i think we're uh good and so i guess and so you know i know that you mostly focused on on warehouse but flex in general too seems to be having the same same scarcity the same uh you know just trying to to even get them on the market to you know to even um yes so i mean a lot of the buildings that we referenced in these conversations they're greater than 200 feet deep and the the meal size that goes into a 240 the 302 foot deep building the minimum deal size is you know roughly thirty four thousand square feet given the way the column lines and the depths of the buildings line up so that's what people are building people are not building kind of a shallow bang flex product right now and so what you're seeing is the second generation buildings you're seeing a premium on the investment sales side um and you're also seeing a premium in the rental rate that's you know if there's a 15 000 square foot state that's 50 office you're seeing that rental rate go you know double digits you know 1150 to 14 triple net and then operating expenses on top of that have increased to over three dollars a square foot you know based on the tax revaluation that occurred in 2019 well a lot of tenants are raising their hand saying you know guys these objects why are they so expensive and you know rob and i have to explain to them that the taxes are a dollar fifty to two dollars a square foot depending on the location so you know to answer your question you know flight is really beneficial you know from these new construction class a buildings because those buildings can't accommodate tenants you know that are smaller than 30 000 square foot and a lot of times these legacy flex products are in bulletproof locations you know they're they're located you know off south boulevard or really close to the airport or off of you know exit 18 with wt herrera where you know there's north lake mall and hotels and you know tons of amenities that these tenants can benefit from so again there's a bigger story there that you know benefiting the flex market all right well you guys thank you both so much it's good to see you and um you know we appreciate it and uh i you know i definitely um needed to to learn a little bit more about the industrial market and that stuff was just all really timely and relevant so um really appreciate that and uh and your time today so thank you so much for having us and if anyone has any questions they can uh feel free to reach out to us individually we'd love to look further but thank you all so much for having us yeah thank you so much and uh yeah well we look forward to you know maybe doing this again next year then great hopefully yep hopefully all right thanks everyone we appreciate it um make sure to check out the north carolina chapter appraisal institute's page for upcoming education we still have virtual um so uh we've got some good stuff coming up with stephen roach um has a course coming up on the um later in march and we want to thank our annual sponsor comp stack they have sponsored our chapter for the year and so um you know we're appreciative of that so again everyone have a fantastic afternoon um it feels like friday it's not but you know but uh we're almost there so have a great uh rest of the week and thanks again guys appreciate it you