- Industrial activity will continue to thrive. There is no indication of a slowdown in this sector for 2018, says Peter Muoio, chief economist at Ten-X. During the latter part of 2017, new demand drivers, including e-retail warehouse distribution and fulfillment space, cloud computing and facilities for legalized cannabis, supported much of the demand in the segment. However, Muoio expects there to be an increased demand from traditional users of industrial space, such as industrial production companies.
By Seth Krchmar, Managing Consultant | MFRTECH
Keeping costs at a minimum is often a top priority for owner/operators of manufacturing facilities; however, they often overlook one key area that can positively impact their bottom line. In fact, property taxes are often one of the biggest line item expenses manufacturing facilities face and can represent 30 to 50 percent of operating costs. The good news is that owners don’t have to take them at face value.
The sweeping Food Safety Modernization Act regulations —originally enacted in 2011 and finalized this year—are going to present some challenges to food manufacturers as they take effect. “The law fundamentally shifts the food safety paradigm from reacting to adulterated food after it reaches the marketplace, to preventing contaminated food from reaching consumers in the first place,” Cushman and Wakefield head of industrial research in the America Jason Tolliver told Bisnow. “This affects every link in the food supply chain, from farm to fork and requires a lot of documentation that heretofore hasn’t been required.” To comply with the new regulations, manufacturers will need to ramp up their use of supply optimization software to manage new record-keeping processes and make some property design changes.
Some South Carolina House members are taking a comprehensive review of the state's tax laws, and are considering phasing out sales tax exemptions, reducing the top state income tax rate, and making property tax changes. Most on the 14 members of the panel meeting Tuesday agreed changes need to be made. The 2017 session of the General Assembly begins in January.
Last month, the Louisiana Board of Commerce and Industry deferred action on more than two dozen requests for the Industrial Tax Exemption Program, which would equal about $15 million in property tax breaks. The decision came after Gov. John Bel Edwards said he wants to change Louisiana’s approach to the tax exemption program created decades ago, and issued an executive order in June spelling out that he intends to tie the tax breaks to job creation and retention and to involve local government agencies in the decisions. Edwards recently announced he is further tightening the rules for the tax exemption program.
The Louisiana Board of Commerce and Industry deferred action on more than two dozen requests for the Industrial Tax Exemption Program on Monday, which would equal about $15 million in property tax breaks. New and expanding manufacturing facilities are allowed an exemption from local property taxes for up to 10 years, but must be signed off by The Board of Commerce and Industry and the governor. However, Gov. John Bel Edwards said he wants to change Louisiana’s approach to the tax exemption program created decades ago, and issued an executive order in June spelling out that he intends to tie the tax breaks to job creation and retention and to involve local government agencies in the decisions.
Building green industrial properties, and seeking LEED certification, is a growing trend for developers and property owners, as they begin to recognize the wide-range of benefits it provides for themselves and tenants alike. According to the U.S. Green Building Council, as of 2013 a total of 117 industrial manufacturing facilities had earned LEED certification. These buildings accounted for 41 million gross square feet of green industrial space. An additional 703 industrial projects had registered for LEED certification as of 2013, buildings that totaled 221 million square feet. The U.S. Green Building Council said that the market of green industrial buildings had grown by 375 percent in the four years leading up to 2013.
Major changes in Michigan Business Personal Property law provide an opportunity for manufacturers to significantly reduce their property taxes. The Michigan Department of Treasury indicates that many manufacturers failed to qualify for the new Eligible Manufacturing Personal Property (EMPP) Exemption due to the complexity of filing.
If you have Industrial Facility Exemption (IFT) returns that have been rejected, the IFT will be revoked if not corrected by the May 31, 2016 deadline. There is still time to file the required forms, but you must act quickly. If you are a manufacturer and are unsure of your exemption status, please contact us today to see how we can assist.
After going through one of the toughest recessions in its history, Northern Nevada’s commercial real estate market suffered greatly as rising vacancies crushed new construction activity and speculative building. The region’s commercial real estate sector is in the midst of a comeback, however, thanks to several economic development victories over the past few years causing a rising tide effect. Major projects, such as the Tesla Motors Gigafactory, Switch Supernap Tahoe Reno Industrial Campus and Rackspace Data Center, helped legitimize Reno as a viable area for industry and technology, said Ted Stoever, vice president of land and investment for Colliers International’s Reno office. Ultimately, these projects are driving job creation opportunities and all the ancillary businesses that go with that.
The San Francisco Planning Department is increasing its efforts to crack down on landlords who lease industrial buildings zoned for manufacturing, automotive repair, warehousing or the arts to office tenants, launching 21 investigations already this year. According to the San Francisco Business Times, the heavier enforcement is all part of effort to make sure areas zoned for production, design and repair (PDR) are kept open and ready for tenants that qualify as "makers" – a group that's been steadily pushed out of the core of San Francisco as rents rise and pricier tech tenants replace them. In 2015, the Planning Department opened 108 cases investigating industrial space leased out for offices, a major leap from four in 2014 and two in 2013, the San Francisco Chronicle reports. The city says that increase reflects how difficult it has become for manufacturers to find space in the nation's most expensive office rental market.