The industrial real estate company has more than $225 million of activity in the Southland, including large projects in L.A. County.
Nancy Shultz, senior vice president at Duke Realty, said the company is active in 20 markets nationwide and is focused on coastal top-tier markets like Southern California, with its busy ports and dense population.
“We are looking for new acquisition opportunities and land to build buildings,” Shultz added.
Duke Realty prefers to develop its own projects. Shultz said the company will occasionally buy existing properties, but the buildings “need to be functional and fit the particular submarket that it’s in.”
In affluent areas, that could mean more office space on site. For assets closer to the ports, that could mean slightly smaller sizes.
Duke Realty also does some repurposing projects, such as an office campus with a warehouse space that the company is currently converting into a last-mile facility.
As far as land for new projects goes, Duke Realty looks for sites that are 10 or more acres in L.A. In other areas, like the Inland Empire, the company wants larger land blocks.
Shultz said Duke Realty is interested in the South Bay, Mid-Counties, Commerce, Vernon and San Gabriel Valley — areas with low vacancy rates and rising rents.
She said Duke Realty is also interested in the San Fernando Valley, but “there’s fewer opportunities out there.
Because it’s hard to find large sites, entitle them and go through California’s environmental review process, Shultz said, it can take a long time to get projects off the ground.
Duke Realty is working on a number of large properties in the region, including a nearly 529,000-square-foot development at 13131 Los Angeles St. in Irwindale.
The property is being built on spec with more than $2 million worth of smart building features. It has a large truck yard, trailer storage, and is close to the freeway and population hubs.
In South L.A., the company is working on a roughly 291,000-square-foot facility at 13344 S. Main St. The development has been preleased to a beverage distributor.
Shultz said the project could draw tenants from the Westside “that are really used to paying a lot higher rates” due to its location.
The property will have a large truck court and be close to the freeway.
“Bigger is hard to do infill, so we’re excited about those projects,” Shultz said.
Of roughly 3.4 million square feet of industrial projects in the works, Duke Realty has preleased 40% of its overall square footage.
And once the company finishes a project, it doesn’t turn around and sell it to the highest bidder.
“We are here forever,” Shultz said, adding that company doesn’t sell in Tier 1 markets.
The only properties Duke Realty would consider selling, she said, are in lower-tier markets so the money can be invested back into areas like L.A.
Looking ahead, Shultz said the company will continue to invest heavily in areas like L.A.
“We believe firmly in the industrial demand and equation going on. It’s no secret that industrial has benefited from the demand increase, and Covid has accelerated the demand from ecommerce,” she said. “I still see robust returns and rising rents. We’re here to keep deploying capital.”
