Employment: U.S. employers will add 2.1 million jobs in 2016, triggering the formation of new households and additional retail spending. Increases in employment in construction and at manufacturers that produce for the domestic market mark positive trends for industrial property operations.
Construction: Developers will complete projects totaling 190 million square feet in 2016. Deliveries in major regional distribution hubs, including Atlanta, Chicago, Dallas/Fort Worth, Houston and the Inland Empire, will account for more than half of the space delivered nationwide this year.
Vacancy: The U.S. vacancy rate will decline 40 basis points this year to 5.9 percent on net absorption of more than 200 million square feet. Nearly 1.1 billion square feet of industrial space has been occupied since the vacancy rate peaked more than six years ago.
Rents: Tight vacancy will support a 5.0 percent climb in the average rent nationwide to $6.30 per square foot in 2016, slowing from last year’s rate of growth. Markets with access to points of entry on both coasts will outpace this rate. Farther inland, Chicago and Denver will also outpace this growth.
FULL REPORT: Second Half 2016 National Industrial