Puget Sound’s YTD Industrial Absorption is a Record-Breaker

After three quarters, the Puget Sound region’s industrial market recorded nearly 9 million square feet of absorption (2.9 million square feet in the third quarter alone), the highest amount in history, according to Kidder Mathews’ latest report. Moreover, development activity remains robust with record high construction volumes.

Here are the regional numbers for the past three months:

• About 600,000 square feet was added to the total supply (net of demolition of older product), so the region now totals slightly more than 355 million square feet
• Under construction space is nearly 10.7 million square feet (55 percent is pre-leased), led by Pierce County (4.1 million square feet) and the Northend (4.0 million square feet)
• Positive net absorption of 2.9 million square feet, led by Pierce County (2.1 million square feet) and Southend (924,000 square feet)
• Vacancy rate for the region decreased from 5.4 to 4.7 percent
• Average asking rental rate increased $0.05/square feet/month to $0.96/square feet/month
• Sales volume has already surpassed 2020 results with $1.1 billion sold through the first nine months, and likely to surpass the record $1.2 billion in 2019

Two large land plays this quarter include Panattoni’s $200 million purchase of 309.35 undeveloped acres from Boeing next to its Frederickson plant. The other is Terreno Realty Corp. It paid $50 million for 11.8 acres along Martin Luther King Jr. Way in Seattle.