Amazons impact on rental market?

Question

A few months ago it was announced that Amazon would be building a large distribution center in our area (Akron, Ohio).

I am interested in hearing from others on their experience with Amazon coming into area and its impact on property?

My gut says there is going to be a need or opportunity if they are hiring 5k people.

Also on this note, I am always interested to talk with others about opportunities.  Have a great day!

Dan Handford · Answer

@Toby Jurging I think you have to be careful in "speculating" on what the market with do when Amazon builds in your city. It's ok to talk about this topic but I would never buy an asset with the hopes of Amazon making it a game changer.

Ben Leybovich · Answer

I agree with @Dan Handford. Additionally, when considering Ohio, Akron is likely the most landlord unfriendly municipality. They don't make anything easy for the landlords, which is why in spite of being a college town, the market is very blah...

James Galla · Answer

Traditionally, large companies installing plants become game changers when they are investing in rural areas without significant development. You can turn to examples in the oil and gas industry where these dead rural towns get the massive influx of cash from the oil and gas investors and the town explodes and dies when the oil and gas are gone.

Amazon in Akron will probably not be significant. I reckon values will go up, but it's not going to be skyrocketing. If you take a look at where the center is going to be - Rolling Acres Mall - that's right next to a D-D- class neighborhood and a C-C- neighborhood. I don't imagine those places are going to have a sudden influx of wealth. If you have a well-paid worker, they're prone to move elsewhere in the Akron metro area or in one of the surrounding townships.

John Wallace · Answer

@Toby Jurging We had a distribution center open about 15 min/10 miles away a couple of years ago, maybe less, and we've seen no change. We have a mobile home/RV community and SFRs.

Tom Ott · Answer

Yes, an increase in both property prices and rents.

Nate Richards · Answer

@Tom Ott, have you seen an increase in SFR sale prices too, or just in rental rates?

Tom Ott · Answer

First hand, it is a big help! In Cleveland, we have 2 new ones that just opened up on the Eastside. We have one in Euclid and the other near Warrensville Heights. Each other them offer around 2,000-3,000 jobs with their minimum wage being $15. The jobs are low-skilled and warehouse type. These are perfect for renters. We have seen a huge influx in demand from both investors and tenants near these locations. I am not saying it will last forever, but it has changed the landscape in these local cities.

Jason Dobbins · Answer

Their distribution centers are typically automated and running with very few employees, i read that they are implementing boxing robots to replace more people.  most stuff gets moved around the warehouse by robots already.  I would highly doubt that they have more than 1000 people working I would imagine if this is a new development it would have the latest and greatest of automation and have even fewer employees.

Amazons impact on rental market?

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