Industrial Inventory Will Boom Again in 2017

American industrial markets filled up more than 63 million square feet of space in the final quarter of 2016, according to “U.S. Industrial MarketBeat Snapshot” by Cushman & Wakefield. During the year, markets absorbed more than 282 million square feet, pushing the industrial vacancy rate down to 5.5 percent.

The 2016 numbers are part of a long-term trend. “The industrial sector has registered 27 consecutive quarters of net occupancy gains,” the report finds.

As space filled up, rents increased as well. Industrial asking rents jumped almost four percent from the fourth quarter of 2015, with increases reported in 61 out of 79 markets. Cushman & Wakefield reports that industrial rents are at historic highs in many markets.

The report forecasts a strong 2017, with one analyst pointing to growing consumer confidence as a positive sign for the year ahead. “When consumers are confident the industrial market benefits, and consumers ended the year upbeat with multiple measures of consumer confidence reaching cyclical highs,” Jason Tolliver, head of industrial research for the Americas, says.


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