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Q1 2024 U.S. Industrial Real Estate Market Report

April 26, 2024 Article 10 min. read
Adam Burgess Plante Moran Realpoint Brandon M. Podolski Plante Moran Realpoint
The U.S. industrial market performance continues to downshift as the second half of 2024 approaches. Net absorption has remained positive but continued to lose steam, with early 2024 registering the lowest first-quarter absorption tally since 2012.
Two construction workers on an industrial building walking between solar cell panels on the roof of factory in the morning

The U.S. industrial market performance continues to downshift as the second half of 2024 approaches. While the national vacancy rate is not expected to rise well above its 20-year average of 7.1%, the next 6 to 12 months could still prove to be the market's most challenging period over the next five years.

National industrial real estate trends

  • Accelerating completions of new industrial developments have caused the U.S. industrial vacancy rate to rise from a record low 3.9% in mid-2022 to 6.2% as of Q2 2024. This is still below the market's 20-year average vacancy rate of 7.3%.
  • Year-over-year rent growth has slowed to 5.2%. New supply additions are likely to push vacancies in the near term and cause rent growth to decelerate further.
  • Higher interest rates have caused construction starts on new industrial projects to plummet since last fall. The volume of projects completing construction each quarter has already begun to decline and will likely hit 10-year lows in late 2025.
  • The stock of U.S. industrial properties is now growing at the fastest pace in more than three decades. Over the past 12 months, the total stock of U.S. industrial space has grown by 2.8%, almost triple the pre-pandemic 20-year average for annual supply growth.
  • Across the entire United States, there is about 1.9 billion square feet (SF) of industrial space listed as available for lease among existing properties and 400 million SF of unleased space currently under construction.
  • Risks of oversupply are most heavily concentrated among properties 500,000 SF or larger.

Download the in-depth market report to learn more

If you’d like to learn more about the nation’s industrial real estate outlook, download the full report below. This report will give you full insight into the topics mentioned above along with a variety of other statistics to help you stay ahead of market trends.

Information contained in this report is provided, in part, from third-party sources, including the U.S. Bureau of Labor Statistics, the Bureau of Economic Analysis, Engineering News-Record, and CoStar Group. Even though obtained from sources deemed reliable, no warranty or representation, expressed or implied, is made as to the accuracy of the information herein.

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