Pennetta: Demand grows for traditional industrial space on Long Island

In Brief:

• Traditional industrial buildings under 30-foot clear height now have a vacancy rate of just 3.4% in Suffolk County.
• New developments like Tomcat Field and Suffolk Technology Park target smaller manufacturing and engineering users.
• Manufacturing and engineering jobs deliver a stronger economic multiplier and higher wages than logistics uses.
• Tomcat Field offers development rights, transportation access, workforce pipelines and Opportunity Zone benefits.

Before the pandemic, myself and our Cushman & Wakefield statisticians helped us see that high-cube space (buildings with a clear height of 30-feet-plus under steel) were leasing five months quicker and getting an additional $0.74 per-square-foot in rent compared to those with shorter ceiling heights. When the COVID-19 pandemic hit, it redefined regional distribution metrics with Long Island, Queens and Brooklyn emerging as a regional distribution market, changing from a minimum required population of 14 million down to an 8 million population. A new distribution warehouse boom followed, adding 4.7 million square feet of new distribution inventory boasting 250,000 square feet to 1 million-square -foot footprints and 40-plus ceiling heights. By contrast, the last wave of traditional Long Island speculative industrial development, with 30 feet clear or less under steel and over 100,000 square feet, dates back more than 20 years to the three-building business park totaling 395,533 square feet in Bohemia on Johnson Avenue.

Fast-forward to 2026—overall industrial vacancy rates for Suffolk County, looking at buildings 30 feet under steel ceiling height and below, the vacancy rate is an astonishing low 3.4%. There are two newly approved industrial park developments looking for the more traditional Long Island industrial space user. One is Tomcat Field, a 412,000-square foot industrial space park development in Riverhead. Located on 30 acres with proximity to the Long Island Expressway, this new park is designed for the smaller users spanning 5,000 square feet to 50,000 square feet. The other is Suffolk Technology Park featuring 100-acre, 1 million-square feet development in Wheatley Heights. Both are looking for that smaller, more traditional manufacturing, assembly and engineering user. Both HK Ventures and Bristol promise indirect benefits because of the new design focus.

Manufacturing, assembly and engineering have always been important to the Long Island economy, and no other industrial use-type matches its jobs multiplier. These industry jobs generate 5.7 times the jobs outside of the building, which indirectly ramps up jobs and employment opportunities for our local region. These jobs generally pay above-average wages, increasing local purchasing power and taxable income. They also stimulate innovation ecosystems, training programs and supplier networks, which have long-term stickiness in a region. Conversely, regional distribution and logistics operations have a much lower economic job multiplier of 1.4 times, and they tend to have higher automation exposure and lower wage averages than manufacturing, assembly and engineering operations.

Tomcat Field’s 412,000-square-foot development is currently being marketed for sale, including property, and the entitlements and development rights. This site sits adjacent to both the 7,000 and 10,000-foot-long runways once used to manufacture and fly Grumman F-14 Tomcat fighter aircraft. There is a town monument just down Middle Country Road (NY 25) showcasing a real F-14 Tomcat which was built in Calverton by Grumman Corporation, when Grumman employed almost 4,000 workers at the site. This opportunity also sits at the crossroads of Long Island’s twin forks, serving as the gateway to both the North Fork (Greenport, Mattituck) and South Fork (The Hamptons, Southampton). The site also offers regional access to Suffolk County’s east-end population centers, which are now more populated year-round than they have been historically. Positive changes to both the Riverhead commercial corridor Old Country Road (Route 58) and the downtown area has made this region much more attractive to live, work and play in. This is also located in a federal Opportunity Zone which gives benefits to property owners at this site. It provides access to three LIRR hubs, two commuter stations in Riverhead and Yaphank, and the commercial spur operating at EPCAL for freight rail. It also benefits from proximity to Eastern BOCES technical programs, Suffolk County Community College, Touro College and Stony Brook University, providing a pipeline of skilled, STEM-oriented talent. Brookhaven National Laboratory is another significant neighbor.

David Pennetta is executive managing director of Cushman & Wakefield and strategic officer of the Commercial Industrial Brokers Society (CIBS).