How strong was the industrial market across the United States? New construction was at a record high in the first quarter of the year, according to the latest research from Cushman & Wakefield.
Cushman & Wakefield, in its first quarter industrial report, said that 251.3 million square feet of new industrial construction was in the pipeline. That is a record high, and is nearly 10 million square feet higher than the 241.4 million square feet reported in the fourth quarter of last year.
Even with the new construction that is taking place, users are eating up industrial space at a fast pace. Cushman & Wakefield reported that absorption in the industrial market hit 56.9 million square feet in the first quarter. That’s just above the 56.5 million square feet reported in the first quarter of 2017.
Rental rates continued to rise, too, hitting their own record high of $5.99 a square foot in the first quarter. That’s a jump of 5.4 percent over the $5.68 a square foot registered in the first quarter of 2017. Of the 79 markets that Cushman & Wakefield tracks, 59 saw an increase in rental rates on a year-over-year basis.
Vacancies, too, fell across the country. Cushman & Wakefield reported that the industrial vacancy rate fell to 5 percent in the first quarter of 2018. That’s down 30 basis points from the same time last year. It’s also a new record low for the industrial market.