The industrial sector showed resilience in 2024 despite cooling from pandemic-era highs. National industrial rents rose 4.5% year-over-year to $10.13 per SF in Q4, while vacancy climbed to 6.7%, still below the 10-year pre-pandemic average. Leasing activity totaled 130M SF in Q4, contributing to 135M SF of positive annual absorption.
Key Highlights:
- Resilient Rents: Q4 rents increased 1% quarter-over-quarter, reaching $10.13 per SF.
- Vacancy Trends: Although vacancies are nearing peak levels, 60% of markets saw positive annual absorption.
- Construction Slowdown: New industrial construction declined 36% year-over-year, with just 291M SF underway, the lowest level since 2018.
- Market Shifts: Amazon led the way with $2B in industrial investments, doubling its 2023 spend, signaling a renewed focus on expansion.
The industrial sector is pivoting toward growth, with occupiers optimizing supply chains and adopting forward-deployed stock models to improve fulfillment strategies.