Cassidy Turley has recently released a report regarding fourth-quarter statistics on the 2011 U.S. industrial sector.
In the report, Cassidy Turley’s Chief Economist Kevin Thorpe discusses the stats. A few key highlights discussed in the document include:
- The U.S. industrial sector had a robust 2011, and ended the year with momentum. Demand for industrial space registered 97.6 million square feet in 2011 – a level of absorption that rivals pre-recession levels recorded in 2005 and 2006.
- The key sectors that drove demand last year were motor vehicles and parts (particularly in the second half of the year), clothing and accessories, semiconductor manufacturing, and food and other commodity-based products. Industrial markets, specifically port cities and distribution center hubs, also benefited from a surge in exports, which increased 17 percent in 2011 to $183.8 billion. In addition, 2011 was the second best year on record for U.S. exports.
- In 2011, 59 out of the 67 markets tracked recorded positive demand for warehouse space. The top ten performers were: Dallas (10.9 million square feet); Phoenix (7.8 million square feet); Detroit (5.7 million square feet); Indianapolis (5.4 million square feet); Atlanta (5.4 million square feet); Nashville (4.0 million square feet); Houston (3.6 million square feet); Central New Jersey (3.5 million square feet); Chicago (3.3 million square feet); and Milwaukee (3.1 million square feet).
- The momentum was evident in the fourth quarter of 2011. Net demand finished the year at 27 million square feet, up from 23.6 million square feet from the previous quarter. The U.S. industrial vacancy rate inched down 10 basis points in the fourth quarter from the previous quarter to 9.1 percent. Vacancy is currently 80 basis points below its peak of 9.9 percent registered in the second quarter of 2010. After rising for two straight quarters, average asking rents slipped to $5.05 from $5.11 NNN. In the development pipeline, there were just 19.9 million square feet under construction as the quarter came to a close – extremely lean for a market that typically delivers an average of 72 million square feet per year.