MARKET TRENDS
- Vacancy continues to climb, reaching 13.6% in Q1 2025. This increase in vacancy is due to the significant amount of new supply coming online, with the market seeing 4.9 million square feet (msf) delivered in Q1 2025. Given the construction pipeline of over 13.0 msf, vacancy is expected to remain elevated in the near term.
- Asking rental rates for industrial space decreased by 9.6% over the past year, averaging $11.24 per square foot (psf) as of Q1 2025. Asking rents are likely to continue softening as new deliveries come online and vacancy rises.
- Net absorption rebounded from the prior quarter’s low, with the market absorbing 2.0 msf in Q1 2025. Despite resilient leasing, demand continues to be outpaced by supply. Going forward, demand is expected to hold, with absorption trending near the five-year average.