{"id":1004598519,"date":"2022-08-18T03:49:55","date_gmt":"2022-08-18T11:49:55","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004598519"},"modified":"2022-12-30T03:23:46","modified_gmt":"2022-12-30T11:23:46","slug":"is-industrials-boom-era-ending","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/is-industrials-boom-era-ending\/","title":{"rendered":"Is Industrial\u2019s Boom Era Ending?"},"content":{"rendered":"
\"Hany<\/a>

Hany Guirguis, Professor of Economics & Finance at Manhattan College and Co-Author of the NAIOP Office Space Demand Forecast. Image courtesy of NAIOP<\/p><\/div>\n

The industrial space market in the U.S. right now stands at the complex intersection of a slowing economy, the recovery of global supply chains, growing costs for carrying inventory<\/a>, pent-up demand, a still-growing inventory of logistics space and a gradual turn away from e-commerce back to bricks-and-mortar.<\/p>\n

How that all adds up, according to a new report from NAIOP<\/strong><\/a>, is that retailers and logistics firms have moderated the pace at which they\u2019re acquiring industrial space. Net absorption in the first half of 2022 was 151.2 million square feet, which was a sharp drop from the record pace of 2021, yet still well above prior years.<\/p>\n

\n

READ ALSO<\/strong>: Is Flexible Warehousing the Next Step for Industrial?<\/a><\/p>\n

\n
\"Michael<\/a>

Michael Seiler, DBA, Professor of Real Estate and Finance at the College of William & Mary. Image courtesy of NAIOP<\/p><\/div>\n

In their third-quarter forecast, authors Hany Guirguis, Ph.D., professor of economics and finance at Manhattan College, and Michael Seiler, DBA, professor of real estate and finance at the College of William & Mary, say they anticipate cooling in the industrial space market, with the net absorption rate continuing to decline, till it returns to pre-pandemic numbers.<\/p>\n

They expect total net industrial space absorption in the second half of this year to be 112.4 million square feet, and full-year absorption in 2023 to be 209.4 million square feet. For context, first-half 2020 net absorption was 223.6 million square feet, followed by 103.4 million of negative net absorption in the second half of that year.<\/p>\n

A gentle stop?<\/h2>\n

There may be a leveling off in the industrial real estate sector that is a healthy rebalancing of where things should be when viewed through a long-term historical perspective, NAIOP President & CEO Marc Selvitelli, CAE, said in a prepared statement.<\/p>\n

\"Marc<\/a>

Marc Selvitelli, President & CEO, NAIOP. Image courtesy of NAIOP<\/p><\/div>\n

\u201cThe sector saw unprecedented growth that had been accelerated by the pandemic and related supply chain issues,\u201d he continued. \u201cAs those two situations unwind, we will see a more natural course of growth.\u201d<\/p>\n

In light of Selvitelli\u2019s comments, one observation from the report stands out: \u201c\u2026 even if all new properties without preleases were delivered as vacant this year, the national vacancy rate would still be close to its historical, long-run average.\u201d<\/p>\n

So, although the boom times might be ending, at least\u2014for now\u2014they seem to be coasting to a halt, not crashing.<\/p>\n","protected":false},"excerpt":{"rendered":"

After reaching new heights, the industrial market is showing signs of slowing down, says NAIOP.<\/p>\n","protected":false},"author":882,"featured_media":1004561297,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[22251,21748,23891,21742],"tags":[32878],"class_list":["post-1004598519","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-in-focus","category-industrial","category-national","category-latest","tag-naiop"],"acf":[],"yoast_head":"\nIs Industrial\u2019s Boom Era Ending? - Commercial Property Executive<\/title>\n<meta name=\"description\" content=\"After expanding to unexpected heights, the industrial market is showing signs of slowing down, according to NAIOP.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/is-industrials-boom-era-ending\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Is Industrial\u2019s Boom Era Ending?\" \/>\n<meta property=\"og:description\" content=\"After expanding to unexpected heights, the industrial market is showing signs of slowing down, according to NAIOP.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/is-industrials-boom-era-ending\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2022-08-18T11:49:55+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-12-30T11:23:46+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2021\/12\/Photo-by-Adrian-Sulyok-on-Unsplash.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"620\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Scott Baltic\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/is-industrials-boom-era-ending\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/is-industrials-boom-era-ending\/\",\"name\":\"Is Industrial\u2019s Boom Era Ending? 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