Industrial Sector Softening in U.S.
Industrial Sector Softening in U.S.
Commercial Real Estate
The U.S. industrial real estate market is experiencing a softening phase, with vacancies climbing to around 7.5% nationally due to an oversupply of new warehouse and distribution space delivered during the pandemic boom. Rent growth has decelerated sharply to 1-2% annually from double-digit peaks, as construction pipelines remain elevated at over 400 million square feet, pressuring occupancy in secondary and tertiary markets.
Despite these headwinds, demand fundamentals hold firm from e-commerce expansion, manufacturing reshoring, and logistics optimization, particularly in high-growth Sun Belt hubs like Dallas-Fort Worth, Inland Empire, and South Florida where absorption exceeds 50 million square feet yearly. Investors are shifting toward last-mile facilities and bulk spaces near ports, anticipating stabilization by late 2026 as deliveries taper and supply-demand balances restore modest growth.
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