TAG Industrial Watch: January 11, 2025

With 2024 in the books, it’s time to review how the national industrial real estate market performed by analyzing the top 50 metros (CoStar, classes A, B, & C, minimum 10,000 square feet). Supply levels continued to recede, falling 31.0% from 2023 to 367.1 million square feet in net deliveries. Despite the slowdown, supply was still higher than in any period prior to 2020. Demand dropped 34.6% annually to 125.5 million square feet of net absorption, representing the lowest level since 2010. As a result of supply outpacing demand, the national vacancy rate jumped 120 basis points to 6.9%, touching an 11-year high. Consequently, market rent growth decelerated 490 basis points to 2.5%, marking the sharpest downturn since full market coverage began in 2007 and the slowest pace since 2012. At the close of 2024, there were 319.8 million square feet under construction. While the pipeline was 51.7% off the record set in 2022, the construction projects were still historically high. Big-box warehouses led the way with vacancies up 160 basis points to 8.9%, hitting the highest since 2010. Midsize vacancy rates followed, rising 130 basis points to 6.8% and topping the highest level since 2013. Small industrial properties were the top performer with vacancy rates rising only 60 basis points as they approached a 10-year high to 4.2%. Next week, we’ll start taking a look at how TAG’s top markets performed in 2024.
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Our thoughts and prayers are with all those affected by the Los Angeles fires.

I N D U S T R I A L   N E W S

Industrial Vacancy Climbs As Market Stabilizes
GlobeSt.com – December 26, 2024
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Capturing Equity In Industrial Buildings
Commercial Property Executive – December 18, 2024
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US Corporate Bankruptcies Soar To
14-Year High In 2024; 61 Filings In December
S&P Global – January 7, 2025
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Food Prices Are On The Rise Again
As A Variety Of Commodities Increase
ABC 12 News – December 15, 2024
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Port Strike Averted As Longshoremen,
USMX Reach Contract Agreement On Automation
ZeroHedge – January 9, 2025
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R E G I O N A L   N E W S

JV Of Center Capital, Authentic
Adds Two SoCal Industrial Assets
Connect CRE – January 6, 2025
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When All Is Said? 2024 Will Go Down As
A Solid Year For The U.S. Industrial Market
REjournals – December 31, 2024
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Consolidated Secures $18M For
Denver-Area Industrial Assets
Commercial Property Executive – December 16, 2024
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Most Destructive Fire In Los Angeles
History Sends Property Owners Reeling
GlobeSt.com – January 8, 2025
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Tesla Annual Deliveries Fall For First
Time As Incentives Fail To Drum Up Demand
Yahoo! Finance – January 2, 2025
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