CONTACT US
Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting cushmanwakefield.com to read:%0A%0A {0} %0A%0A {1}
Industrial Industrial

Insights

U.S. Industrial Reports

DOWNLOAD Q3 2024 REPORT

Access the latest quarter commercial real estate results for the U.S. industrial sector. MarketBeat reports analyze quarterly market activity including supply, demand and pricing trends.

For the data behind the commentary, download the full Q3 2024 U.S. Industrial Report.

Leasing Activity Remains Above Pre-pandemic Levels 

While some occupiers’ “wait and see” approach to space needs is dampening demand from recent record highs, third-quarter leasing activity (139.6 msf) was 8% higher than the 10-year pre-pandemic average and nearly equal to last year’s total (140.9 msf). Since the start of 2024, 433.6 msf of new deals have been completed, a slight decrease of 6.7% compared to the first three quarters of 2023. However, 32 markets posted YTD increases in new leasing volume, with 22 markets posting improvements of 10% or higher. Many larger occupiers continued the flight-to-quality trend, with 65% of the square footage leased YTD by tenants with 100,000 square feet (sf) or more occurring in warehouse facilities built since 2020. These newer, high-quality assets have captured nearly two-thirds of leasing activity, despite representing only 13% of total inventory. 

Net absorption was modest in the third quarter, as some large occupiers continued to shed unneeded space due to cooling consumer demand and shifting of inventory strategies. With 29.4 msf in the third quarter, net absorption was down 35% quarter-over-quarter (QOQ) but was 40% stronger than the first quarter of 2024. As in recent years, much of the positive net absorption is tied to the delivery of either build-to-suit or preleased speculative developments, continuing the trend that new, high-quality product continues to outperform. Eight markets yielded more than 5 msf of YTD net growth, and 60% of the industrial markets recorded positive absorption during that time. Meanwhile, eight markets accounted for the majority of negative YTD absorption, led by Los Angeles, Oakland/East Bay, Northern New Jersey and Seattle.

Vacancy Levels Normalize Further

Both vacant speculative deliveries and some additional sublease vacancies pushed the U.S. industrial vacancy rate up from 6.1% in the second quarter to 6.4% in the third. Although higher than the lows posted in 2021 and 2022, the vacancy rate remains below pre-pandemic averages, at 7%. Of the 84 markets tracked by Cushman & Wakefield, 48 had vacancy rates at 6% or lower at the close of the quarter. However, two-thirds of U.S. markets experienced QOQ increases in vacancy rates. While vacant sublease space continued to tick higher nationally, the bulk of new sublease vacancies were concentrated in a handful of markets, led by Los Angeles, Phoenix, Chicago and the Inland Empire.

Despite cooler demand and rising vacancy rates, the U.S. average asking rental rate increased by 4.3% YOY to $10.08 per square foot (psf), surpassing the $10 psf mark for the first time in history. While rent growth has moderated in 2024 compared to the double-digit gains of 2022 and 2023, some markets continue to report robust gains. Of the 84 markets tracked, 58 reported YOY rent growth, and 12 reported rent growth of 10% or higher. Conversely, 26 markets reported annual rent declines, with the largest decreases mostly occurring in markets on the West Coast.

Construction Pipeline Thins Out

Another 90 msf of new industrial facilities were delivered in the third quarter, marking the first time quarterly deliveries fell below the 100-msf mark since the first quarter of 2022. Speculative construction continues to dominate, accounting for 83% of the 335.8 msf of YTD deliveries. After the current wave of supply is delivered, there isn’t much on the other side. As of the third quarter, only 309.3 msf of industrial product is under development, the lowest level since 2018. One year ago, 29 markets had at least 5 msf of industrial developments underway. Now, only 18 markets have pipelines exceeding 5 msf. This sharp drop in new construction sets the stage for vacancy to erode and rent growth to accelerate more meaningfully in the outer years of our forecast horizon (2026-27).

For the data behind the commentary, download the full Q3 2024 U.S. Industrial Report.

Q3 2024 U.S. INDUSTRIAL MARKETBEAT
Access Q3 2024 commercial real estate results for the industrial sector.
Download Report

Featured Insights: Current U.S. MarketBeats

US Office MarketBeat (image)
MarketBeat

U.S. Office Reports

Access the latest quarter commercial real estate results for the office sector nationally. MarketBeat reports analyze quarterly market activity including supply, demand and pricing trends.
David Smith • 10/10/2024
U.S. National Industrial MarketBeat (image)
MarketBeat

U.S. Industrial Reports

Access the latest quarter commercial real estate results for the U.S. industrial sector. MarketBeat reports analyze quarterly market activity including supply, demand and pricing trends.
Jason Price • 10/10/2024
U.S. National Retail MarketBeat Report (image)
MarketBeat

U.S. Shopping Center Reports

Access the latest quarter commercial real estate results for the retail sector nationally. MarketBeat reports analyze quarterly market activity including supply, demand and pricing trends.
James Bohnaker • 10/10/2024
U.S. National Multifamily MarketBeat (image)
MarketBeat

U.S. Multifamily Reports

Access the latest quarter commercial real estate results for the U.S. multifamily sector. MarketBeat reports analyze quarterly market activity including supply, demand and pricing trends.
Sam Tenenbaum • 10/10/2024

Related Insights

Construction Insights summer 2024 webcard.jpg
Research • Construction

Construction Insights

The Construction Insights – Outlook 2024 report aims to provide insights into the key factors that influenced the US construction sector in 2024, empowering you to make informed decisions for your organization throughout the year 2024.
Tyler Paytas • 11/7/2024
US Ports Update 2024_Web Card 1.jpg
Research

U.S. Ports Update

Overview of U.S. port-proximate industrial real estate markets and port performance.
Jason Price • 10/16/2024
Manufacturing Resurgence
Research

U.S. Manufacturing Resurgence?

Disruptions to supply chains across the world have been the norm over the past three years, bringing the impacts of globalization and the importance of well-functioning supply chains into sharper focus.
David Smith • 9/18/2023

Related Industries & Specialties

Bangkok cityscape
Article • Government / Public Sector

Data Connectivity through the One Map Platform in Thailand

One Map is a government project to develop and integrate geographic data in Thailand, with the aim of being a central digital data source as a standard, covering all areas, and easily accessible through the One Map website and application.
Tatchada Supakornpichan • 9/16/2024
Dubbele kloof zorgt voor extra druk op logistiek vastgoed
Insights • Supply Chain

Double gap puts additional pressure on logistics real estate

The introduction of zero-emission zones will only increase pressure on logistics Netherlands. This calls for more cooperation to bundle flows of goods into cities. 
Femke van Amelsvoort • 7/25/2023
Logistics & Industrial
Creating a Competitive Edge through Commercial Real Estate
Learn More
Automotive & Mobility Group
Cushman & Wakefield’s Automotive & Mobility Group is a leading provider of consulting and real estate expertise to the automotive and mobility industry.
Learn More
Business Incentives
Our goal is singular. Reduce your total real estate cost with the shortest, clearest path to financial success by implementing strategies for the development, expansion, consolidation or relocation of facilities.
Learn More
Retail, E-Commerce & Logistics
At the connection of retail, e-commerce, logistics and industrial, we offer omnichannel solutions to keep you current in an evolving landscape.
Learn More
Food & Beverage
No matter where you sit in the F&B supply chain--from processing to distribution--our expertise will guide smart real estate decisions.
Learn More
Ports & Intermodal
Our professionals analyze ocean cargo and container-movement trends to help clients make decisions based on intelligent market knowledge.
Learn More
Rail
Our Rail advisors help monetize under-utilized properties and rail-adjacent site selection. We also have extensive experience in rail yard management, valuation and securing business incentives.
Learn More
3PL
Our unique approach partners with 3PL providers, focused on success in winning new contracts, retaining current clients, and increasing revenues.
Learn More

Ready to talk?

We’re on hand to help. Get in touch and we can assist with any additional information you need.

With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on  Cookies

More Options
Agree and Close
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All
SAVE SETTINGS