TAG Industrial Watch: November 1, 2025

The release of government data, like the jobs report, may still be on hold, but the third-quarter results of the national industrial market are ready to go! After recording the first quarter of negative absorption in 15 years, industrial demand rebounded in Q3 to about 24.2 million square feet (down -45.6% year-over-year). With 56.3 million square feet of net deliveries added to the inventory, supply dropped to its lowest level since Q4 2016, but continued to outpace demand for the 13th consecutive quarter. As a result, the national vacancy rate rose by 20 basis points on the quarter to 7.7%, representing the highest level since Q1 2013. The increase in availability weighed on rents as the annual growth rate slowed to a 13-year low of 1.6%. At 324.8 million square feet, the amount of industrial space under construction ticked up for the first time since peaking in Q3 2022 (Costar, top 50 metros, classes A, B, & C, minimum 10,000 square feet).

While the level of demand in Q3 is an encouraging sign, the overall economic environment gives pause for concern, particularly the impact of tariffs. After another brief episode of tariff frontloading in July, U.S. imports resumed their descent with U.S. container imports sliding by 6.6 percent year-over-year in September. As TAG has pointed out before, most of the industrial real estate in the U.S. is heavily dependent upon imports. The good news is that property values have yet to reflect the reality of the market and the economy, giving industrial investors time to create a game plan to transition their portfolio from import-related properties to export-related properties.

I N D U S T R I A L   N E W S

Tenant Demand Fuels Q3 Industrial Turnaround​​​
GlobeSt.com – October 27, 2025
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BRICS Speeds Up Dollar Selling, Chinese Firms
Offload $51.8 Billion
Watcher.Guru – October 23, 2025
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UPS Deepens Job Cutting As Part Of Turnaround,
Says 48,000 Roles Eliminated This Year
CNBC – October 28, 2025
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Norfolk Southern Revenue Falters In Q3
FreightWaves – October 23, 2025
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U.S. Container Imports Plunge 6.6% In September
As Tariff Fallout Takes Hold
gCaptain – October 24, 2025
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R E G I O N A L   N E W S

Interest On Rise For Proposed ​​​​​13-Mile San Antonio Highway
Connect CRE – October 27, 2025
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Holding Steady, Moving Forward: Chicago’s
Industrial Market Builds Momentum
REjournals – October 21, 2025
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VanTrust Real Estate To Develop 708,918 SF
Spec Industrial Project In Terrell, Texas
REBusiness – October 22, 2025
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Embraer To Invest $70M In Aircraft Maintenance
Expansion At AllianceTexas
Bisnow – October 21, 2025
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EQT Real Estate Buys 4.8 MSF Logistics Portfolio
Commercial Property Executive – October 28, 2025
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