“The market is steady and reasonable,” said CommercialEdge director Peter Kolaczynski. “The pullback in construction was inevitable and expected this year. As space gets absorbed in 2025 and 2026, we expect vacancy rates to plateau and the appetite for further development to pick up toward the latter part of the decade.”
About 34.5 million square feet of industrial space went online during the fourth quarter across the 30 major U.S, markets included in the report, while 188.2 million square feet are currently under construction. Phoenix topped the list for both deliveries and pipeline for the quarter.
All 30 major markets saw annual increases in average ask rents, the report said. Orange County had the highest nationwide average rent at $16.2 per square foot. Orange County also saw industrial vacancy decrease quarter over quarter, achieving the lowest vacancy rate of the markets studied at 4.2% during the fourth quarter. The national industrial vacancy rate during the quarter was 8%.
The average sale price for industrial space was highest in the San Francisco Bay Area at $458.40 per square foot. Three other California markets – Orange County, Los Angeles and the Inland Empire – also were among the top five markets for industrial sale prices.
Portland, Oregon, had the lowest share of real estate loans maturing this year, followed by Bridgeport, Connecticut, and Baltimore, the report said.
CommercialEdge’s online search data shows Houston with the highest volume of industrial real estate keywords searched during the fourth quarter. Boston recorded the most search interest growth year over year, said the firm.
