by Dan Rafter
The U.S. industrial market is on pace for a record-breaking year, according to the latest numbers released by Cushman & Wakefield.
The company said that the industrial market is seeing low vacancies and a significant amount of absorption. This, of course, is causing industrial rents to rise in most of the country’s major industrial hubs, according to Cushman & Wakefield’s third-quarter research report.
“Healthy industrial fundamentals are still prevalent overall. For most markets, the industrial sector continues to perform extremely well,” said John Morris, logistics & industrial services lead, Americas, Cushman & Wakefield, in a written statement.
The country’s industrial markets saw net absorption of 57.9 million square feet during the third quarter, definitely a strong performance. Throughout the first three quarters of the year, the U.S. industrial market absorbed 173.1 million square feet, Cushman & Wakefield reported.
At the same time, the weighted average U.S. industrial rental rate hit $5.34 triple-net in the third quarter That’s an increase of 4.8 percent from the same quarter one year earlier.
According to Cushman & Wakefield, about 70 percent of all U.S. industrial markets had positive rental growth in the third quarter, while 45 percent have seen year-over-year growth higher than 5 percent. A total of 14 U.S. markets had double-digit gains in rents.
Cushman & Wakefield reported that the national industrial vacancy rate fell to 7.4 percent in the third quarter. A total of 25 U.S. markets had industrial vacancy rates lower than 6 percent.
These strong fundamentals have inspired plenty of new construction. Cushman & Wakefield reported that as of the end of the third quarter, construction activity totaled 182.3 million square feet across the United States. Atlanta, Chicago, Dallas/Fort Worth, Inland Empire, Houston and Pennsylvania’s I-81/I-78 Distribution Corridor all had in excess of 10 million square feet in the development pipeline.