After years of rapid development and shifting market conditions, the U.S. industrial sector appears to be entering a new phase, one marked by improving fundamentals, rising demand and a more balanced supply pipeline.
That’s one of the key findings from Colliers’ June 2026 report, The Markets That Move America: An Inside Look at the Top 25 U.S. Industrial & Logistics Markets.
The report examined the nation’s 25 largest industrial markets, which account for 76% of America’s industrial inventory among the 78 markets tracked by Colliers.
According to the report, the industrial market is transitioning away from the post-pandemic construction boom that flooded many regions with new supply. Today, developers are pulling back while occupier demand is gaining momentum.
In its report, Colliers wrote that the surge in new industrial supply is over. According to Colliers’ research, new industrial deliveries fell 24% year-over-year nationwide while construction activity sits roughly 60% below its 2022 peak.
That shift is helping bring balance back to the market.
Across the country, industrial inventory grew by just 0.5% over the past year, a sharp decline from the rapid expansion seen during the height of the logistics boom. The 25 largest markets grew faster, posting 1.3% annual inventory growth, but even those numbers reflect a significantly slower pace of development.
Several Sun Belt markets continue to dominate industrial activity. Dallas-Fort Worth led all markets with 22.9 million square feet of inventory growth during the past year, followed by Houston with 20.1 million square feet. Greater Los Angeles, Atlanta and Phoenix also remained among the nation’s most active logistics hubs.
Colliers reported that net absorption across the top 25 industrial markets increased 19% year-over-year to nearly 146 million square feet. Nationwide, industrial demand rose 5.2% to 186 million square feet over the last 12 months.
Dallas-Fort Worth remained the nation’s top performer, recording 24.3 million square feet of net absorption. Phoenix followed with 18.5 million square feet, while Indianapolis emerged as one of the strongest Midwest markets with 15.7 million square feet of absorption. Chicago also posted impressive results, recording 14.2 million square feet of demand growth.
The Midwest continues to demonstrate strong fundamentals. Nine of the nation’s top 25 industrial markets sit in the Midwest, and several are seeing demand outpace supply.
Indianapolis stood out as one of the country’s strongest markets. According to Colliers, the market recorded 15.7 million square feet of net absorption while adding only 3.9 million square feet of new supply during the same period. Columbus, Cincinnati and Memphis also posted strong supply-demand balances.
These conditions are already affecting vacancy rates.
National industrial vacancy reached 7.4% in the first quarter of 2026, up 37 basis points year-over-year. However, conditions were somewhat tighter in the top 25 markets, where vacancy rose only 11 basis points to 7.2%.
Some markets are already seeing vacancy decline. Indianapolis posted one of the largest improvements in the country, with vacancy falling 364 basis points year-over-year to 7.1%. Columbus and Phoenix also recorded significant decreases as demand absorbed previously delivered space.
Phoenix still has the highest vacancy rate among major markets at 10.6%, but even there conditions have improved significantly from a year ago.
Colliers said that the combination of moderating supply and strengthening demand could soon create tighter market conditions in many regions.
Construction activity remains well below its pandemic-era peak, according to Colliers. Industrial space under construction totaled 286 million square feet nationally in the first quarter of 2026, far below the 711 million square feet under construction in 2022.
Dallas-Fort Worth continues to lead the nation with 34.3 million square feet under construction, while Houston ranks second with 24 million square feet underway. The New York metro area saw one of the biggest increases, with its construction pipeline expanding 150% year-over-year.
Still, developers appear increasingly selective. Build-to-suit projects continue to dominate, but Colliers reported that improving market conditions are laying the groundwork for the eventual return of speculative development.
Rents are also stabilizing. National warehouse and distribution asking rents dipped 0.5% year-over-year to $10.46 per square foot, reflecting a normalization after several years of record increases. Yet rents in the top 25 markets still rose 0.8% to $9.72 per square foot.
Houston led the nation in rent growth, posting a 14.2% increase over the past year.
