The national industrial vacancy rate rose by 20 basis points (bps) to 6.7% in the fourth quarter of 2024, according to data from Cushman & Wakefield (NYSE:CWK), which noted the current level is 30 bps below the 10-year, pre-pandemic average.
Overall net absorption in the fourth quarter measured 36.8 msf, up slightly from the 33.3 msf recorded in the previous quarter but down 20% year-over-year. Approximately 135 msf of industrial product was absorbed by the end of last year.
Quarterly new leasing activity totaled approximately 130 msf in the fourth quarter and was down 15.7% compared to one year ago. Since the start of the year, 591.3 msf of deals were transacted, down 4.8% year-over-year. Asking rents ticked higher by another 1% quarterly during Q4 to $10.13 psf.
New construction deliveries continued to decelerate for the second straight quarter – only 85.3 msf of new industrial product was completed in the fourth quarter, down 8% from the third quarter and down and 48% from one year earlier.
Nonetheless, the new data determined that 2024 was the sixth strongest year on record for new deal activity. There were seven markets which surpassed 20 msf of new leasing activity for 2024 with the Inland Empire (46 msf) and Dallas/Fort Worth (45.5 msf) exceeding the 45-msf mark for the year.
“We’ve witnessed an uptick among firms looking to lease larger buildings to support their omnichannel fulfillment strategies and maintain inventory for their e-commerce, wholesale, and retail stock. This trend is not just about space, but about efficiency and customer satisfaction,” said Jason Tolliver, president of logistics and industrial services at Cushman & Wakefield. “Meanwhile, we’re also seeing a flurry of activity to support forward-deployed stock models, a strategy that keeps products closer to the market they serve and where customers order them, promising quicker deliveries and happier customers.”
