The future of commercial real estate development in the United States? Much of it is targeted for rural areas that have largely been ignored until now.
Why? Industrial developers are increasingly searching for larger swaths of land for their data centers, warehouses and auto-manufacturing plants. More frequently, they find this land in rural areas of the country. This has created thousands of new jobs in these areas.
As the jobs arrive so does the need for new multifamily developments, retail centers, healthcare facilities and recreational amenities. This is leading to a influx of development activities in rural counties across the United States.
It’s a trend highlighted in a new research report released in late October from Northmarq. In its report, Northmarq looks at nine rural markets, including some in the Midwest, that have become hot beds of commercial development.
One of these areas is Lafayette, Indiana. Here, Northmarq says, housing demand has far exceeded the supply of available residential units. Northmarq says that Lafayette’s proximity to Purdue University and its growing manufacturing sector has blessed the city with some of the strongest multifamily fundamentals in the nation.
Northmarq reported that in 2025, Lafayette posted a multifamily occupancy rate of 98%, one of the highest in the United States. This is evidence of a tight rental environment. Lafayette is also home to major industrial and manufacturing employers including Subaru of Indiana Automotive, Caterpillar, Wabash and Arconic. As these companies continue to offer well-paying jobs, a steady number of new residents will arrive in Lafayette, only boosting the need for new multifamily development.
Northmarq says that the average rental price of multifamily units here continues to rise on a year-over-year basis, an indicator that the Lafayette needs more rental housing, an opportunity for developers.
Northmarq also lists Fayette County, Ohio, as one of its rural areas to watch. This county in Southwest Ohio is at the center of the state’s industrial boom, Northmarq says, with a big investment in new development expected to bring thousands of jobs to the area. But like many rural areas, the local infrastructure is not prepared for this surge.
Northmarq reported that a 2023 housing study found a need for nearly 1,400 new housing units in Fayette County by 2033 to support the incoming workforce. Most of the county’s current housing stock is older. There are limited rental options for newcomers.
Fayette County will soon be home to a new LG Energy Solution EV battery plant and an Amazon Web Services data center campus. These new additions will sit alongside existing distribution centers for Walmart, Lowe’s and McKesson.
It’s not surprising that Fayette County has been targeted for industrial development: It sits along the Interstate-71 corridor between Columbus and Cincinnati, making it a strong logistics hub. Northmarq says that savvy developers will find opportunities to bring new workforce housing, single-family homes, retail, restaurants and medical facilities to the area.
Then there’s Sioux Falls, South Dakota, another rural area listed in Northmarq’s report. Northmarq says that Sioux Falls boasts a strong economy focused on financial services, healthcare and agribusiness. What it needs more of, though, is housing.
According to Northmarq, the city’s vacancy rate for apartments has historically remained below the 5% mark. There was a flood new multifamily construction that delivered in early 2025, spiking the area’s apartment vacancy rate to nearly 10%. But six months later, the market had absorbed enough of these units to drop that rate back to 5.4%.
Like other strong rural areas, Sioux Falls boasts major employers, including Sanford Health, Avera Health, Wells Fargo and Smithfield Foods. Northmarq says that the city is also a hub for data centers and bioengineering.
Despite all its positives, Sioux Falls has been underserved because it is not on the radar of most national developers, Northmarq says. Because of this, there are plenty of opportunities for developers eager to build multifamily developments here.
