Bruce Duncan, president and CEO of First Industrial Realty Trust, Inc. (NYSE: FR), joined REIT.com for a CEO Spotlight video interview at REITWorld 2015: NAREIT’s Annual Convention for All Things REIT at the Wynn Las Vegas.
First Industrial owns industrial real estate in major markets across the United States.
Duncan said he is “very encouraged” by industry fundamentals heading into 2016. During the third quarter, First Industrial’s occupancy rate increased to 95.5 percent from 95.1 percent, he said.
“We’ve got great demand for tenants in all sizes across the country,” Duncan said. “We’re pretty bullish.”
Duncan stressed that First Industrial focuses more on development than acquisitions. The company currently has more than $200 million of development under construction, representing about 3.3 million square feet and a 7 percent yield.
“We’re doing it all around the country. We’re very encouraged by tenant demand, not just the big boxes, but smaller properties as well,” he observed.
Duncan added that the risk-adjusted returns on development are far more attractive than acquisitions. However, he noted that the approximately $20 billion in industrial acquisitions made during the last year bodes well for First Industrial and its peers.