The availability of industrial space nationwide fell in the first quarter to 9.2 percent, its lowest level since 2001, with capacity pressured by the demands of e-commerce providers for more warehouses and distribution centers, according to a report from real estate services and investment firm CBRE Group Inc.
That figure is down 20 basis points from the fourth quarter and marks the 24th consecutive quarter of declining availability, the firm said yesterday. Available space is defined as space that is currently occupied but has been put on the market, usually because the current tenant is leaving at the end of its lease. It is usually higher than a market's vacancy rate, which reflects unoccupied property.
As a result, industrial rents will continue their rise this year after increasing by 5.3 percent last year, to $5.74 per square foot, CBRE said.
The study said new construction over the next two years would increase warehouse space and slow the rise in rents. However, rents will continue climbing for the rest of 2016, the firm predicted.
New construction increased by nearly 14 percent in 2015 to add 150.5 million square feet to the pool of U.S. industrial space. New space is on track to ramp up higher over the next two years, CBRE said.