How strong was 2022 for the Indianapolis industrial market? According to Colliers‘ most recent research, this market saw a fourth consecutive year of record-high new leasing activity.
Colliers reported that leasing activity grew 13.9% in the Indianapolis industrial market last year, leading to 17.5 million square feet of net absorption for the year.
Even with this record level of leasing activity, though, the market’s vacancy rate rose to 5.4% in the fourth quarter of last year, up from 4.8% in the third quarter and 3.8% in the first.
Why the increase? Colliers points to the amount of new construction taking place in the Indianapolis industrial market this year. According to Colliers, the market saw 21.2 million square feet of new spec industrial deliveries last year, with this new construction adding to the market’s vacancy rate.
And construction isn’t slowing. Colliers reported that 24.6 million square feet of industrial space was under construciton in the Indianapolis market at the end of last year.
Asking rents continues to rise, too, with Colliers reporting that this figure rose to $5.31 a square foot as of the end of 2022, up from $4.65 a square foot from the first quarter of last year.
Not surprisingly, the Indianapolis industrial market saw several big leases last year. Ambrose closed a 1.2-million-square-foot industrial lease in the Indianapolis East submarket, while Deckers Outdoor Corporation leased 1 million square feet in nearby Monrovia, Indiana. And Geodis also closed a 1-million-square-foot industrial lease last year, in Clayton, Indiana.