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

Hillwood Adding 2 New Industrial Buildings
In Alliance Area Of Fort Worth
Community Impact – August 21, 2023
Read More