The U.S. industrial market is having yet another booming year, with the sector on track to finish 2018 with its third best net occupancy growth, according to Cushman & Wakefield.
Cushman & Wakefield, in its third-quarter industrial report, said that only 2016 and 2014 saw a stronger net occupancy growth in this sector.
What does this mean? Only that the three strongest years of industrial occupancy growth have occurred in the last five years. And Cushman & Wakefield doesn’t expect a slowdown in this sector anytime soon, with the combination of limited new industrial product and high occupancies signaling a strong performance for Class-A industrial spaces in the near future.
According to Cushman & Wakefield, U.S. industrial markets absorbed 66.3 million square feet in the third quarter of 2018. This pushed year-to-date industrial absorption to 203.9 million square feet, a jump of 10.5 percent from the 184.5 million square feet registered a year ago.
Cushman reported that 41 markets recorded more than 1 million square feet of net industrial absorption and 29 surpassed 2 million square feet of occupancy gains year-to-date.
Chicago ranked as one of the strongest industrial markets in the country, according to Cushman & Wakefield.
And in more good news, the U.S. industrial vacancy rate sunk to an all-time low of 4.9 percent, 130 basis points below the five-year historical average of 6.2 percent for all product types. This vacancy drop comes despite the delivery of 72 million square feet of new product in the third quarter of 2018.
Cushman & Wakefield said that industrial vacancy rates have dropped during the last 12 months in 50 of the 79 markets the company tracks. In the Midwest, Cincinnati saw a particularly low industrial vacancy rate of 2.9 percent.
