Industrial net absorption is projected to be 314.9 million square feet, according to a forecast published by the NAIOP Research Foundation. That averages out to 78.7 million square feet per quarter. In 2022, net absorption is projected to be 231.6 million square feet, with a quarterly average of 57.9 million square feet.
According to the report, the industrial sector continues as the leading property type, due largely to increased demand for e-commerce during the pandemic and the distribution infrastructure needed to support it. Net absorption rates in industrial reached their highest levels since 2000 last year, with higher rents and low vacancy rates.
“When the economy stabilizes, fundamentals will once again drive market behavior, and net absorption rates will likely mean-revert toward long-term growth trends,” the report states. “As more industrial tenants secure the space they need, net absorption rates will gradually dissipate in the coming quarters to levels that will likely be only slightly higher than economic fundamentals would have predicted before the pandemic.”
Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism.
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