The U.S. industrial market finished 2019 strong, absorbing 68.8msf in the fourth quarter—the largest in a single quarter last year. Despite the slow start to the year, demand won out, bringing the year-end total to 233.8 msf of absorption. As a result, the market surpassed the 200 msf projected for a sixth consecutive year. Net occupancy growth in 2019 did moderate from its all-time high in 2018 (287.8 msf), but absorption levels remained healthy and will remain so heading into 2020.
New supply reached 100.3 msf in the fourth quarter of 2019—the highest square footage completed in a single quarter on record. This brought the 2019 total to 307.8 msf—up 7% YOY. Supply did outpace overall demand by a little over 74 msf at year-end 2019, as expected, but vacancy rates still remained tight across markets, at 4.8% for a third consecutive quarter, 90-basis points (bps) below the five-year historical average.