Strong demand for U.S. warehouses and distribution centers continued to outpace new supply in the third quarter, driving the average availability rate to a slight decline, CBRE Group Inc., the Los Angeles-based real estate and logistics services giant, said Wednesday.
U.S. industrial availability registered 7.7 percent in the third quarter, down from 7.8 percent in the second quarter and from 7.9 percent a year earlier, according to CBRE. The decline was the market's 28th of the past 29 quarters.
In raw numbers, third quarter demand—measured by CBRE as net absorption of industrial space—came in at 61 million square feet, which was greater than the 51-million-square-foot supply of new space, measured as construction completions.
CBRE expects demand to continue to exceed supply due to expected gains in U.S. gross domestic product (GDP) and in warehouse employment.
"With growth expected to remain at a similar pace for the fourth quarter and into early next year, we expect demand to remain strong," CBRE Americas Chief Economist Jeffrey Havsy said in a statement. "The supply pipeline is increasing, but vacancy isn't expected to rise dramatically, and the market remains fundamentally balanced."