Liberty Sees Healthy Demand for Properties in Piedmont Triad

Liberty Property Trust LPT has been experiencing decent demand for its properties at the Piedmont Triad in North Carolina. The company recently announced signing of six leases, aggregating 148,555 square feet of space in the region.

Specifically, the fourth-quarter activities included a major new lease in High Point, and five more new leases and renewals in Greensboro. This indicates the solid demand in the Triad as companies look for easy interstate access, a strong labor pool and modern industrial facilities.

The major lease involved that of Metropolitan Warehouse and Delivery Corp. which signed a long-term agreement for a 104,000-square-foot building at 4193 Eagle Hill Drive in High Point. Notably, the company developed and enjoys ownership of all four buildings in Eagle Hill Business Park that provides more than 445,000 square feet of space. Offering easy access to Highway 68 and I-40, along with the Piedmont Triad International Airport, this business hub grabs decent attention of tenants.

Further, at Green Point Business Park in Greensboro, the company has struck three new leases and two renewals, aggregating 44,555 square feet of area. The company owns four buildings in the fully leased park which too offers decent access to the I-40 and Highway 68 interchange.

Among the new leases were those of Arjo Inc. for 12,718 square feet of space at 4500 Green Point Drive and Davinci Aerospace, LLC’s lease for 6,840 square feet of area in the same building. The other lease was at 4501 Green Point Drive, where Fourth Zodiac signed a new lease for 7,540 square feet of space.

The renewals included that of LabelPack Automation for 5,600 square feet of space at 4500 Green Point Drive, while an unspecified tenant has renewed lease for 11,857 square feet of area.

Notably, Liberty Property is shifting its focus toward industrial properties due to favorable demand and supply conditions. Its premium quality industrial properties, situated at key locations, are likely to drive long-term growth by leveraging on the e-commerce boom and supply-chain strategy transformations. Furthermore, the company has been experiencing healthy rent escalation on retained and replacement leases in its industrial portfolio.

Not only Liberty Property, but also other industrial REITs, including Prologis, Inc. PLD, Terreno Realty Corporation TRNO and Duke Realty DRE, have the scope to ride on growth curve. This is because with a recovering economy and job market gains, as well as tax reforms, consumption levels are anticipated to remain elevated. And with a healthy manufacturing environment, along with high business inventories, demand for warehouse and logistics real estate will likely remain high.

Nonetheless, with rising supply of industrial real estate space, there is lesser scope for any robust rent hike in the near term. Also, any protectionist trade policies may have an adverse impact on economic growth, as well as the company’s business over the long term.

Liberty Property currently has a Zacks Rank #3 (Hold). The company’s shares have appreciated 4.5% in the past three months, while its industry has inched up 0.1%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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