Portland’s industrial market has held firm during the COVID-19 pandemic due to strong growth in delivery and e-commerce services. The Portland industrial market is remaining robust in 2021, largely driven by activity from e-commerce and third-party logistic companies, according to the latest Kidder Mathews report.

Demand for industrial land will continue to be sought-after, raising prices to all-time highs. Other nontraditional industrial product types including refrigerated space will be in high demand in the market.

Although net absorption and vacancy have been flat during the past 12 months, institutional landlords are still able to push rents in most submarkets. With land scarcity, cost to construct and a vacancy rate remaining at sub-5 percent, Kidder Mathews researchers don’t expect this trend to change in the near future.

Market Highlights:

• Direct vacancy rates increased to 4.5 percent, up 36 percent Y-O-Y
• Absorption rates were at positive 168,660 square feet by the end of first quarter 2021
• Construction projects remain active, with more than 3.1 million square feet of industrial developments in the pipeline
• Unemployment rates reached a high 14.3 percent in April 2020. Since then, unemployment has gradually fallen, standing at 6.2 percent by first quarter 2021, according to the Federal Reserve Bank of St. Louis.