There have been no signs of a slowdown as the market continues to record strong absorption gains, consistent rent growth and healthy development activity. This year is on pace to record over 8.8 million square feet of positive absorption, marking the eighth consecutive year of positive absorption gains.
During the previous cycle, absorption peaked at 7.8 million square feet in 2005 but dipped to -3.4 million square feet by 2009. Developers and users alike have been careful to avoid the oversupply seen during the recession, gravitating toward build-to-suits or waiting for pre-leasing commitments before breaking ground.
At 8.3 percent, vacancy is slowly approaching the low of 7.1 percent reached in 2006. Over 27 million square feet of tenants in the market for space suggest that demand for industrial space will continue well into 2018.
Source: JLL Research
About the author
Kiana Cox is a senior research analyst in the JLL Phoenix office who works closely with brokerage and support professionals throughout the western region, as well as colleagues throughout the global JLL organization, to provide best-in-class research that differentiates JLL.