Industrial Midwest

Cushman & Wakefield: Nothing but good news in industrial sector

Cushman & Wakefield: Nothing but good news in the industrial sector,ph01

Need more proof that the U.S. industrial sector is a hot one today? Cushman & Wakefield recently released its second-quarter industrial report, and the news was good. According to the report, U.S. industrial markets absorbed 64.1 million square feet in the second quarter, up 4.9 percent when compared to the same quarter a year earlier.

And that’s just one of the positive statistics contained in the report. Cushman & Wakefield reported, too, that the national industrial vacancy rate stood at a low 5 percent in the second quarter. That is 180 basis points below the five-year historical average of 6.8 percent.

Developers are taking advantage of this hot market. Cushman & Wakefield reported that construction starts rose across the nation by 8.1 percent on a quarter-over-quarter basis.

According to the report, there is now 267.2 million square feet of indutrial product under construction. Of this number, an impressive 178.3 million square feet is speculative, an indicator of the confidence developers have in this commercial sector.

The biggest challenge for end users is finding space. Cushman & Wakefield reported that space options are particularly difficult to find in the 100,000- to 250,000-square-foot segment. New supply has lagged in this category while demand for facilities of this size has soared.

The future? It’s bright, too. Cushman & Wakefield predicted that the industrial absorption this year will pass the net occupancy gains of 2017, with this year ranking among the top five years on record. Net absorption should surpass 240 million square feet in 2018 for the third year in a row. It should eclipse 200 million square feet in 2019 for a sixth straight year.

Cushman & Wakefield pointed to Chicago as one of the country’s strongest industrial markets. The Chicago market saw 9.8 million square feet of industrial absorption during the second quarter. Demand, then, was sky high here for industrial product.