{"id":3848,"date":"2024-12-27T08:11:08","date_gmt":"2024-12-27T08:11:08","guid":{"rendered":"https:\/\/www.commercialsearch.com\/blog\/?p=3848"},"modified":"2025-11-12T09:51:20","modified_gmt":"2025-11-12T09:51:20","slug":"november-industrial-market-update-vacancy-rate-climbs","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/blog\/november-industrial-market-update-vacancy-rate-climbs\/","title":{"rendered":"November Industrial Market Stats: Vacancy Rate Climbs to 7.5% Amidst Supply Absorption"},"content":{"rendered":"

As 2024 concludes, the industrial market is normalizing after years of record supply, though not without facing challenges such as East Coast labor strikes, the Red Sea conflict and the collapse of Baltimore\u2019s Francis Scott Key Bridge.<\/p>\n

According to CommercialCafe’s industrial market report<\/a>, the national vacancy rate reached 7.5% in November \u2014 a 10-basis-point increase month-over-month and a significant rise from below 4% two years prior. This increase reflects the market\u2019s ongoing absorption of the substantial new supply delivered in recent years.<\/p>\n

However, 2024 has seen a marked slowdown in construction activity. While more than 1.1 billion square feet of industrial space came online between 2022 and 2023, only 330.7 million square feet have been delivered year-to-date in 2024. New construction starts have also decreased significantly, totaling 208.7 million square feet through November.<\/p>\n

Miami Continues to Lead in Rent Growth<\/h2>\n

Industrial rent growth continued in November with the national average rising 6.9% year-over-year to $8.25 per square foot. Miami<\/a> led the nation with an 11.1% increase, reaching $12.11 per square foot. It was followed by New Jersey (10.5%) and the Inland Empire, Calif. (10%).<\/p>\n

This marked a continuation of the changing of the guard that began in October, when Miami became one of the few non-southern California markets in nearly five years to hold the top spot, displacing the Inland Empire. In November, this trend solidified as New Jersey moved into second place, pushing Inland Empire, Calif., to third.<\/p>\n

In contrast, the Midwest experienced weaker rent growth. For example, St. Louis saw the slowest increase at 2.7%, averaging $4.86 per square foot. Kansas City, Mo. (3.2%); Detroit (3.6%); and the Twin Cities (4.2%) also lagged behind the national average.<\/p>\n

Additionally, a significant gap emerged between in-place rents and new lease rates. Nationally, new leases averaged $2.15 per square foot higher than existing rents. Miami again led this metric with a $5.86 premium for new leases, while St. Louis saw new lease rates slightly lower than in-place rents by $0.17.<\/p>\n

Chicago Sales Activity Slips Compared to Fellow Large Markets<\/h2>\n

National industrial asset sales reached $54.6 billion through November, slightly below the $62.8 billion recorded for the full year 2023. While final 2024 figures are expected to approach last year\u2019s total once all data is compiled, higher interest rates have tempered activity. Even so, strong investor demand pushed average sale prices up 2.7% to $128 per square foot.<\/p>\n

In this case, the Bay Area led the nation in year-to-date sales price per square foot at $460, followed by other Western markets \u2014 Orange County, Calif. ($314); Los Angeles ($290); and Inland Empire, Calif. ($270).<\/p>\n

In Chicago<\/a> \u2014 the largest U.S. industrial market by square footage (considering southern California is divided into three distinct markets) \u2014 sales growth has lagged versus the national average. Since 2019, Chicago\u2019s average sale price has increased by 35%, which is significantly less than the national increase of 60%. Notably, Chicago\u2019s major transactions in 2024 occurred in January, including a $95 million purchase near O\u2019Hare Airport and an $83.5 million data center acquisition in Elk Grove Village.<\/p>\n

Atlanta Defies National Contraction as Construction Pipeline Nearly Doubles<\/h2>\n

While national industrial construction totaled 361.1 million square feet in November, representing just 1.8% of total stock, the pipeline saw its first growth this year after increasing by 2.3 million square feet month-over-month. Phoenix led with 24.1 million square feet under development, followed by Dallas (16.08 million) and Houston (12.35 million).<\/p>\n

However, Atlanta<\/a> bucked the national trend of contracting pipelines by nearly doubling its construction activity this year, largely fueled by a surge in data center projects. As of November, 9.3 million square feet were under construction in Atlanta with 5.3 million square feet specifically dedicated to data centers. Notable projects include Phase 1 of Microsoft\u2019s $1.8 billion data center campus with an additional 6.4 million square feet of data center space in the planning phase.<\/p>\n\n\n\n\n\t\n\t\n\t\n\t\n\t\n\t
Industrial properties in Dallas<\/a><\/td>Industrial properties in Columbus<\/a><\/td>Industrial properties in Nashville<\/a><\/td>\n<\/tr>\n
Industrial properties in Phoenix<\/a><\/td>Industrial properties in Denver<\/a><\/td>Industrial properties in Baltimore City<\/a><\/td>\n<\/tr>\n
Industrial properties in Chicago<\/a><\/td>Industrial properties in Seattle<\/a><\/td>Industrial properties in Los Angeles<\/a><\/td>\n<\/tr>\n
Industrial properties in Houston<\/a><\/td>Industrial properties in Atlanta<\/a><\/td>Industrial properties in Cleveland<\/a><\/td>\n<\/tr>\n
Industrial properties in Philadelphia<\/a><\/td>Industrial properties in Cincinnati<\/a><\/td>Industrial properties in Portland<\/a><\/td>\n<\/tr>\n
Industrial properties in Indianapolis<\/a><\/td>Industrial properties in Boston<\/a><\/td>Industrial properties in Charlotte<\/a><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n","protected":false},"excerpt":{"rendered":"

As 2024 concludes, the industrial market is normalizing after years of record supply, though not without facing challenges such as East Coast labor strikes, the Red Sea conflict and the collapse of Baltimore\u2019s Francis Scott Key Bridge. According to CommercialCafe’s industrial market report, the national vacancy rate reached 7.5% in November \u2014 a 10-basis-point increase month-over-month and a significant rise from below 4% two years prior. This increase reflects the market\u2019s ongoing absorption of the substantial new supply delivered in recent years. However, 2024 has seen a marked slowdown in construction activity. While more than 1.1 billion square feet of…<\/p>\n","protected":false},"author":3163,"featured_media":690,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[4],"tags":[],"class_list":["post-3848","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industrial-real-estate-reports"],"acf":[],"yoast_head":"\nNov' Industrial Market: Normalization Alongside Slowed Construction<\/title>\n<meta name=\"description\" content=\"As 2024 comes to a close, the industrial market shows signs of normalization despite East Coast labor strikes, the Red Sea conflict, and the Key Bridge collapse.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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