We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • INDUSTRY PRESS ROOM
  • SUBMISSIONS
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • CSCMP EDGE 2022 Startup Alley
    • Upload your video
  • PODCAST ETC
    • Podcast
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • Reflections
      • SCQ Forum
    • Mobile Apps
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • CSCMP EDGE 2022 Startup Alley
    • Upload your video
  • PODCAST ETC
    • Podcast
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • Reflections
      • SCQ Forum
    • Mobile Apps
Home » Vice grip on industrial real estate space loosens slightly, Cushman & Wakefield says

Vice grip on industrial real estate space loosens slightly, Cushman & Wakefield says

As economy cooled off, vacancy rates ticked up in Q1 but remain well below historical norms.

cushman macro-outlook-industrial.jpeg
April 10, 2023
Supply Chain Quarterly Staff
No Comments

Amid a historically tight market for warehouse space, vacancy rates for U.S. industrial properties ticked up slightly in the first quarter but remained stubbornly low compared to long-term averages, according to a report from real estate firm Cushman & Wakefield.

The industrial vacancy rate ticked slightly higher to 3.6%, as demand for space moderated and speculative construction completions persisted at a healthy rate, the firm said. But while that rate has risen each of the last two quarters, the market remains historically low, stuck at 70 basis points below the five-year quarterly average (4.3%) and 170 basis points lower than the 10-year average (5.3%).

Tough economic statistics such as high interest and inflation rates will probably not help matters improve anytime soon. Looking at building projects for additional industrial space, the under-construction pipeline continued to decline modestly (-3.0% since year-end 2022) as completions outpaced construction starts. And construction starts are anticipated to further slow as the year progresses under the current economic climate, the firm said.

But those same economic forces can also be helpful, since they’re cooling the overall economy and putting the brakes on demand for space that had exploded during the pandemic. Overall net absorption started the year with 62.5 million square feet of positive demand, a drop of 48.5% compared to Q1 2022. While absorption has tapered off significantly compared to the past couple years, it is showing a normalization of market conditions to historical average and more sustainable demand levels, Cushman & Wakefield said.

“Given the voracious pace of growth the past two years and some timidity tied to a more uncertain economic outlook, deals are taking a bit longer to get done, but they are getting done and I remain upbeat on the outlook,” Jason Tolliver, executive managing director and co-lead of Americas Logistics & Industrial Services at Cushman & Wakefield, said in a release. “We continue to see a diverse mix of tenants in the market seeking space and that bodes well for future leasing activity. I think we’ll see a more normalized market than the frenzied pace of the past 24 months with industrial demand shifting back to more sustainable levels as the market powers forward.”

 

 

 

Warehousing
KEYWORDS Cushman & Wakefield
    • Related Articles

      Warehouse rents to climb through end of 2023, Cushman and Wakefield says

      CBRE: logistics real estate supply ticked up slightly in second quarter

      Industrial real estate market poised for growth

    Recent Articles by Supply Chain Quarterly Staff

    Cargo theft and fraud rose 41% in the first 20 weeks of 2023 over last year, CargoNet warns

    Gartner: Top supply chains of ’23 balance risk control, new growth channels

    OSHA, industrial safety experts to headline National Forklift Safety Day 2023

    You must login or register in order to post a comment.

    Report Abusive Comment

    Most Popular Articles

    • Report: Sagging freight stats show that trucking sector is returning to its historic mean

    • Survey: parcel delivery drivers are frustrated by using their own smartphones for work

    • Heavy transport across two continents

    • Survey: most Americans unaware that truckers face shortage of parking spaces

    • Supply chain executives not yet seeing expected results from technology investments

    Featured Video

    20221107korber large vs

    Enhancing Customer Experience with Your Supply Chain Strategy

    Viewer Contributed
    With the rise of e-commerce, many businesses have had to transform their warehouses to handle online orders in addition to regularly scheduled inventory shipments. This means warehouses need more information than ever before to ensure they can meet customers' needs. As a result, companies need to select warehouse...

    FEATURED WHITE PAPERS

    • Three layers of forklift safety: Promoting operating best practices

    • The Complete Guide to Automated Packaging

    • Five tips for parcel success in 2023

    • Guide to Pallet Rack Safety

    View More

    Subscribe to Supply Chain Quarterly

    Get Your Subscription
    • SUBSCRIBE
    • E-NEWSLETTERS
    • ADVERTISING
    • CUSTOMER CARE
    • CONTACT
    • ABOUT
    • STAFF
    • PRIVACY POLICY

    Copyright ©2023. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing