Quarterly demand for industrial space falls for the first time in 15 years
OWNGARDEN | Moment | Getty Images
Five years ago, when the pande pushed e-commerce to the new heights, the industrial warehouse area became the largest commercial real estate game. It began to slow down in 2022, but now the constantly changing tariff policy and the economic uncertainty of continuous high inflation have previously damaged the hot real estate sector.
According to the August report of Naiop’s August report, the industrial area of 27 million square meters was absorbed in the first half of this year, and the demand fell only 11.3 million in the second quarter – the first three -month decline since 2010.
Since the uncertainty will continue until the end of this year, NAIOP predicts that the net absorption will be “almost flat” in the second half of this year.
The authors of the report, “the occupants’ time to adapt to a new tariff regime is expected to improve industrial field demand somehow.” “However, the slowing of higher tariffs and employment growth will probably lead to a slower demand increase than 2020-2022 or more than six years before the pandema.”
NAIOP predicts that the absorption will be recovered starting from the second quarter of 2026 and full -year absorption is a total of 119.3 million feet square. In the first half of 2027, another absorption of 109.7 million square meters awaits.
According to a separate report from Yardi, this year’s industrial property sales, they match last year’s speed. Industrial sales were $ 74.3 billion in 2024, which increased by 14.7% from 2023, but in 2021, it fell from the highest level of all time.
The price discretion cooled down after 2019 and 2022, when the average sales price of an industrial property increased by 54%.
“The capital was cheap and investors wanted to make a profit from record rental growth caused by historically low industrial gap rates above the remaining supply.”
According to the Hard report, so far, the average sales price for completed industrial transactions was only 6% higher than the average of 2022.
In July, the national industrial space rate increased by 9.1%, 10 basis points from June and 270 basis points from July 2024 to 270 basis points.
“We have watched the industrial investment market from Darling for the last few years, but we expect activity and interest with the increasing expectation of economic clarity,” said Peter Research Director Peter, “for the last few years.” He said.
