{"id":4212,"date":"2025-03-10T08:53:48","date_gmt":"2025-03-10T08:53:48","guid":{"rendered":"https:\/\/www.commercialsearch.com\/blog\/?p=4212"},"modified":"2025-11-12T09:56:01","modified_gmt":"2025-11-12T09:56:01","slug":"manufacturing-mega-projects-drive-industrial-construction","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/blog\/manufacturing-mega-projects-drive-industrial-construction\/","title":{"rendered":"Manufacturing Mega Projects Reshape Southeast; Dallas, Phoenix Lead Industrial Construction"},"content":{"rendered":"

Federal incentives, global shifts and renewed efforts to bring supply chains stateside have caused U.S. manufacturing construction spending to triple since 2021. According to the monthly CommercialCafe industrial report, 100 million square feet of industrial space has been delivered since 2022 with another 100 million square feet currently under development. This surge is transforming the industry as semiconductor, electric vehicle (EV), and battery mega projects create ripple effects \u2014 attracting suppliers and logistics hubs to regions like the Southeast and Sunbelt.<\/p>\n

For instance, in the Savannah, Ga<\/a>., and Hilton Head, S.C., area, Hyundai\u2019s $5.9 billion, 17 million-square-foot EV plant (partially operational since October 2024) has sparked nearby investments from companies such as Daechang Seat Company and Ecoplastic Corporation. Further projects are also in the pipeline.<\/p>\n

\u201cIt\u2019s not only the initial boost in activity that we see by these semiconductor, EV, and battery super projects, but the supportive projects downstream that have helped buoy the construction pipeline and economic development of the primary development,\u201d <\/em>said Peter Kolaczynski, director of Yardi Research Data.<\/p><\/blockquote>\n

Meanwhile, Charlotte, N.C.<\/a>, has emerged as a key hub. Nearly one-third of its 5.95 million square feet under construction \u2014 almost 2 million square feet \u2014 is earmarked for manufacturing. Specifically, a repurposed Philip Morris site in Cabarrus County now anchors more than $1 billion in planned investments from companies including Eli Lilly, Red Bull, and Ball, while Bosch\u2019s power tools facility in Lincolnton and Corvid Technologies\u2019 expansion in Mooresville further underscore the market’s growing role.<\/p>\n

Southern Markets Dominate Industrial Pipeline<\/h2>\n

On a national scale, Southern markets occupied three of the top four spots in industrial development with Dallas-Fort Worth<\/a> at the forefront, reporting 22.56 million square feet under construction. Phoenix follows with 17.67 million square feet, while Houston and Memphis, Tenn., have 13.17 million and 11.72 million square feet, respectively. Although Dallas\u2019 pipeline is down by approximately 8 million square feet year-over-year, it nevertheless saw a month-over-month increase from 18.9 million square feet at the end of December.<\/p>\n

At the other end of the spectrum, Baltimore<\/a> has one of the smallest pipelines among major markets. However, its construction activity more than doubled in the last year, rising from 920,000 square feet in January 2024 to 2.5 million square feet in January 2025. Nationally, 346.2 million square feet of industrial space was under construction as of January 2025, representing about 1.7% of the nation\u2019s total inventory.<\/p>\n

Rent Growth Accelerates in Port & Southeastern Markets<\/h2>\n

In January, national industrial rents reached $8.35 per square foot \u2014 a 6.8% increase from the previous year. In particular, port-adjacent and Southeastern markets recorded the strongest gains with New Jersey<\/a> up 10.9%; both Inland Empire, Calif., and Miami rising 9.2%; Nashville, Tenn., at 9.0%; and Atlanta at 8.6%. And, although increased supply has the national vacancy rate at 8.0%, strong demand for modern, high-quality space is keeping rents on the rise.<\/p>\n

At the same time, new leases now command a premium of about $2.22 per square foot above existing rates, with Bridgeport, Conn.<\/a>, and Miami leading at $5.22 and $4.96, respectively. Bridgeport also ranked as the second-tightest industrial market nationwide with a 4.2% vacancy rate \u2014 trailing only Kansas City, Mo., at 3.2%.<\/p>\n

Sales Volume Shifts Inland as Port Markets See Declines<\/h2>\n

In 2024, industrial property sales totaled $69.2 billion with properties averaging $129 per square foot. Dallas-Fort Worth led with nearly $6 billion in transactions, while Houston and Phoenix each recorded about $3.4 billion. In contrast, Los Angeles registered $3.2 billion and fellow Californian the Inland Empire\u2019s sales dropped to $2.4 billion \u2014 a 45% decrease from its 2023 peak \u2014 reflecting a shift from traditional port markets to inland hubs offering better cost and infrastructure advantages. In fact, the Inland Empire saw a 5.3% increase in its average sale price per square foot, while Los Angeles experienced a 2.5% decline. Lastly, the Bay Area continued to command a premium at $414 per square foot.<\/p>\n

For more analysis across all major industrial markets in the U.S., see\u00a0CommercialCafe\u2019s original report<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Federal incentives, global shifts and renewed efforts to bring supply chains stateside have caused U.S. manufacturing construction spending to triple since 2021. According to the monthly CommercialCafe industrial report, 100 million square feet of industrial space has been delivered since 2022 with another 100 million square feet currently under development. This surge is transforming the industry as semiconductor, electric vehicle (EV), and battery mega projects create ripple effects \u2014 attracting suppliers and logistics hubs to regions like the Southeast and Sunbelt. For instance, in the Savannah, Ga., and Hilton Head, S.C., area, Hyundai\u2019s $5.9 billion, 17 million-square-foot EV plant (partially…<\/p>\n","protected":false},"author":3163,"featured_media":3145,"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-4212","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industrial-real-estate-reports"],"acf":[],"yoast_head":"\nU.S. Manufacturing Mega Projects Drive Industrial Construction<\/title>\n<meta name=\"description\" content=\"Since 2021, spending on U.S. manufacturing construction has tripled, driving momentum in industrial construction, particularly in the southeast.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link 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