The Evolving Landscape of Site Selection: Top 5 Macroeconomic Factors and Industry Trends
Trends Impacting Site Selection
In today’s rapidly shifting economic environment, businesses must navigate a complex array of macroeconomic factors and industry trends to make informed site selection decisions. At Land Strategies, we specialize in site selection, economic development consulting, and manufacturing industry insights to help companies identify optimal locations for growth while mitigating risk and maximizing opportunities. Here are the five most significant trends shaping site selection today.
1. Supply Chain Resilience and Nearshoring
Global supply chain disruptions, exacerbated by geopolitical tensions and the lingering effects of the COVID-19 pandemic, have forced companies to rethink their sourcing and distribution strategies. Many businesses are shifting towards nearshoring—moving production and distribution closer to key markets—to reduce risks associated with international trade and logistics. This trend is driving increased demand for industrial facilities across the United States. At Land Strategies, we help businesses evaluate the complexities of nearshoring and identify locations that balance cost efficiency with supply chain security.
2. Workforce Availability and Demographic Shifts
The competition for skilled labor remains a top priority for businesses evaluating site locations. With aging populations and evolving workforce expectations, companies are gravitating toward regions with a strong pipeline of talent, favorable demographics, and access to training programs. Markets with robust educational institutions, workforce development initiatives, and a high quality of life are becoming increasingly attractive for manufacturing site selection and economic development projects. Land Strategies works closely with clients to assess workforce availability, analyze labor market trends, and develop strategies to ensure long-term talent retention and growth.
3. The Growing Demand for Energy and Infrastructure Constraints
The increasing demand for high-energy consumption projects—such as data centers, advanced manufacturing facilities, and electric vehicle & battery production plants—is placing unprecedented strain on the electric grid. Many regions are facing dwindling electricity availability, with utilities struggling to keep up with demand. Long lead times for adding new power capacity further complicate site selection for energy-intensive projects. Businesses are prioritizing locations with existing excess capacity, access to renewable energy sources, and strong utility partnerships that can expedite power expansion projects. Land Strategies helps companies navigate these energy constraints, identifying locations with reliable power infrastructure and working with utility providers to secure future capacity.
4. The Tight Industrial Real Estate Market and Its Impact on Site Selection
The demand for industrial real estate has surged in recent years, driven by the expansion of e-commerce, manufacturing reshoring, and the growing need for logistics and distribution centers. However, available industrial space is becoming increasingly scarce, leading to rising lease rates, land shortages, and intensified competition for prime locations.
This tight market is influencing site selection as businesses prioritize regions with available land, flexible zoning regulations, and strong infrastructure to support rapid development. Companies are also exploring adaptive reuse of older industrial properties and strategic partnerships with developers to secure necessary space. Land Strategies provides clients with critical insights into industrial real estate trends, with experience in markets nationwide, helping clients identify cost-effective solutions and navigate complex permitting and zoning challenges.
5. Mergers & Acquisitions Impacting Manufacturing and Industrial Growth
Mergers and acquisitions (M&A) continue to reshape the manufacturing landscape, impacting site selection decisions across the industry. Consolidation is driven by factors such as increasing competition, supply chain optimization, and technological advancements. Companies undergoing M&A activities often reassess their real estate portfolios, leading to plant closures, facility expansions, or relocations to more strategic locations. Private equity investment in manufacturing is also fueling demand for modern, well-equipped industrial spaces in key markets, further influencing site selection trends. Land Strategies helps companies navigate the complexities of site selection during M&A activities, ensuring seamless transitions and identifying opportunities for growth and optimization.
Conclusion
The site selection landscape is more dynamic than ever, with macroeconomic factors, industry trends, and economic development policies playing a crucial role in decision-making. Businesses must remain agile, leveraging data-driven insights and expert guidance to choose locations that support their strategic objectives. At Land Strategies, we are committed to helping our clients navigate this evolving landscape, ensuring they make location decisions that drive long-term success. Our expertise in site selection, economic development, and infrastructure planning positions us as the ideal partner for companies seeking to optimize their location strategy in today’s competitive market.
