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​​​​​​United States Industrial Outlook | Q1 2018

Positive sentiment indicators and continued buoyant tenant demand for logistics space point to a good start for markets in 2018.

Spurred by an increase in absorption of warehouse space, U.S. industrial rents inched up further reaching $5.53 per square foot, with year-over-year growth of 5.3 percent. As top logistics markets continue to operate at a sub–3.0 percent vacancy rate, we expect continued competition for quality space to add pressure on rents through 2018.

Total U.S. new deliveries were at 58.6 million square feet—up over the same period last year. Nearly 81% of the U.S. development pipeline is dominated by smaller to mid-sized industrial buildings ranging from 50,000-500,000 s.f. Overall preleasing rate for properties in the development pipeline remains stable at 44.8 percent.

Here are three things to keep an eye on in the coming months:

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Click through the tabs below to compare market performance across key categories.

Inventory (s.f.)

Total inventory tops 12.5 b.s.f. led by Chicago, Los Angeles and Philadelphia/Harrisburg.

Market Inventory (s.f.)
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Rental rates ($)

Average asking rents jumped to $5.25 per square foot. Northern New Jersey saw the highest year-over-year rent growth, followed by San Francisco Mid-Peninsula, Seattle and Inland Empire.

Market Rental rates ($)
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YTD net absorption (s.f.)

Annual net absorption grew 11.9% to 58.4 m.s.f. Philadelphia, Dallas and Atlanta led absorption, contributing 34% alone.

Market YTD net absorption (s.f.)
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Total vacancy (%)

Vacancy rates fell in nearly three-quarters of U.S. markets, dropping overall U.S. vacancy to 5.3%. California continues to have the tightest markets in the country, led by Los Angeles (0.9%), East Bay (1.2%) and Orange County (1.5%).

Market Total vacancy (%)
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Under construction (s.f.)

206.7 m.s.f. is currently under construction, and an estimated 247.2 m.s.f. is expected to deliver through year end.

Market Under construction (s.f.)
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United States industrial property clock

View interactive version with additional market details.

JLL Industrial Outlook clock (image)

Source: JLL

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