TAG Industrial Watch: September 2, 2023

A recent article by GlobeSt.com highlighted a trend that TAG predicted going into 2023; bulk industrial over 100,000 square feet is in big trouble. As the article mentions, leasing activity has slowed to “normal” pre-pandemic levels. Unfortunately, new deliveries of bulk industrial are hitting the market at abnormally record-high levels. Consequently, the vacancy rate among bulk industrial has jumped from a record low of 4.2% set in Q2 2022 to 6.0% midway through Q3 this year (CoStar). However, early signs show that leasing activity isn’t just returning to normal levels, but crashing toward decade’s lows. What the article doesn’t mention is that small industrial is outperforming its big brother just as we predicted. While absorption has fallen into negative territory, vacancies are only up 0.6 percentage points during the same time period (compared to 1.8% for bulk industrial). Bulk industrial’s big run is indeed coming to an end, but small industrial’s rise is just about to begin.

I N D U S T R I A L   N E W S

Bulk Industrial Space’s Big Run Coming To An End
GlobeSt.com – August 15, 2023
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CRE Delinquencies Rise Another $12B In July,
With Office Leading The Way

Bisnow – July 27, 2023
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Mexico’s Share of US Imports Surpasses China
For Three Straight Months For First Time In Decades

CoStar – July 31, 2023
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There’s More Coal Being Shipped By Sea Than Ever Before
ZeroHedge – August 22, 2023
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Dallas Fed Manufacturing: Business Conditions Weaken In August
Advisor Perspectives – August 28, 2023
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R E G I O N A L   N E W S

Tesla Gobbles Up More Texas Industrial Space
Connect CRE – August 23, 2023
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West Coast Port Workers To Vote On Labor Agreement
Bisnow – August 15, 2023
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Trammell Crow JV Adds 2 Tenants At Houston Asset
Commercial Property Executive – August 31, 2023
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Aerospace Company Announces Completion
Of Fourth Production Facility

Mile High CRE – August 14, 2023
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Hillwood Adding 2 New Industrial Buildings
In Alliance Area Of Fort Worth

Community Impact – August 21, 2023
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