Land Investment in Indianapolis
Indianapolis land prices hit new highs in 2025 with I-70 corridor parcels trading 30% above 2024 levels. Eli Lilly's $9B campus expansion created a land grab for life science development sites within a 15-mile radius of downtown. Industrial parcels along major freight corridors command $45-65K per acre. Multifamily developers chase the last entitled sites in Fishers and Carmel. Raw land deals dried up - everything's about entitled parcels now.
Market Context
Cap Rate Range
Industrial land trades at 4.5-6% returns on pro forma, multifamily sites at 5-7%, retail pads at 6.5-8.5%
Current Vacancy
Entitled industrial land has 6-month absorption, multifamily sites average 12-18 months to close
Rent Trend
Land lease rates up 25% year-over-year for industrial, 15% for multifamily development sites
Absorption
Industrial parcels move within 90 days at market pricing, entitled multifamily sites take 6-12 months
Price Per Unit Trend
Multifamily development sites trading at $18-28K per door pro forma, up from $15-22K in 2024
Transaction Volume
$340M in land transactions Q4 2025, 85% above 2024 levels driven by Eli Lilly supplier demand
Submarket Analysis
I-70 West Corridor
4.5-5.5% capVacancy
Zero entitled industrial land available
Avg Rent (1BR)
$0.85-1.20 PSF NNN ground lease
Amazon, FedEx expansion driving 40% price increases. Buyers paying $55-75K per acre.
OM Tip
Include truck traffic counts and proximity to intermodal facilities - buyers want data within 2 miles of I-70/I-465 interchange
North Suburbs (Carmel/Fishers)
5.5-7% capVacancy
18-month supply of entitled multifamily sites
Avg Rent (1BR)
$22-28K per door development cost
Eli Lilly workforce housing demand. Entitled sites trading immediately. Raw land sits.
OM Tip
Hamilton County schools and Lilly shuttle access are deal drivers - highlight both in executive summary
Downtown/Near Eastside
6-8% capVacancy
Mixed-use entitled parcels moving fast
Avg Rent (1BR)
Ground lease $8-15 PSF NNN
TIF districts make deals pencil. Historic tax credits add complexity but value.
OM Tip
TIF eligibility and historic designation status must be clear on page one - buyers won't dig for this info
Southwest Industrial
5-6.5% capVacancy
Limited industrial land inventory
Avg Rent (1BR)
$0.75-1.10 PSF NNN
FedEx hub expansion creating supplier demand. Build-to-suit deals common.
OM Tip
Airport proximity and freight rail access drive valuations - include maps showing both
Greenwood/Southside
6.5-8.5% capVacancy
Retail pad sites have 12-month inventory
Avg Rent (1BR)
$12-18 PSF ground lease
Population growth supports retail but development costs rising faster than rents.
OM Tip
Traffic counts and retail demographics within 3-mile radius are table stakes for pad site buyers
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What Your OM Needs to Address
Entitlement Status Timeline
Marion County averaged 18-month approval process in 2025, Hamilton County ran 12 months for standard multifamily
Data to Include
Current zoning, required approvals, realistic timeline with contingencies, estimated entitlement costs
Environmental Reports
Phase I older than 12 months kills deals. Industrial buyers want Phase II even for clean sites.
Data to Include
Phase I and Phase II reports, ASTM compliance dates, any IDEM correspondence, soil boring locations
Utility Capacity Letters
Citizens Energy capacity letters expire in 6 months. Industrial buyers need 1000+ amp confirmation.
Data to Include
Current capacity letters from all utilities, upgrade costs, connection fees, service timeline
Traffic Impact Studies
INDOT requires traffic studies for developments generating 100+ peak hour trips. Takes 8-12 weeks.
Data to Include
Existing traffic counts, required improvements, estimated costs, INDOT correspondence
Flood Plain and Wetlands
White River flood plain affects 25% of developable land. Army Corps jurisdiction adds 6-month delay.
Data to Include
FEMA flood maps, wetland delineation reports, Army Corps pre-application meeting notes
Infrastructure Availability
Fiber availability drives industrial values. Water/sewer capacity limits multifamily density.
Data to Include
Fiber providers within 1000 feet, water/sewer capacity analysis, road improvement requirements
Investment Outlook
Short Term
Eli Lilly's supplier buildout continues through 2027. Industrial land prices stay elevated. Multifamily development sites face rising construction costs - some buyers pulling back. Retail pad sites see steady demand but slower price growth.
Medium Term
2027-2029 brings construction completion wave. Industrial absorption slows as Lilly buildout ends. Multifamily sites with current entitlements maintain value while raw land struggles. Infrastructure investment needed to open new development areas.
Long Term
Post-2029 market depends on economic diversification beyond logistics and pharma. Climate resilience becomes bigger factor in site selection. Expect more mixed-use requirements in suburban developments. Transit-oriented development around potential BRT expansion.
Buyer Profile
Build-to-suit industrial users dominate purchases. National multifamily developers cherry-pick entitled sites. Local retail developers active on pad sites. Investment funds buying land banks in growth corridors but want 200+ acre minimum.
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