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Tenant demand for industrial space continues to outpace development

  • ​Industrial tenant demand is outpacing current development by a ratio of approximately 3:1. The ratio was approximately 6:1 in Q3 2016. Developers have delivered a number of new industrial warehouses over the last year and new projects delivering soon will temper further occupancy gains, but short supply will continue to drive rents upwards and create challenges for tenants in the region.
  • Overall vacancy and availability grew slightly in the third quarter but  the market remains tight as landlord-favorable conditions continue. With strong demand for space and a scarcity of available space options, particularly for spaces over 100,000 square feet, industrial tenants looking to expand are currently in a tough spot.
  • 3.1 million square feet of industrial product has been delivered year-to-date, and another 6.0 million square is currently under construction. New deliveries are likely to be leased quickly as there are nearly 18 million square feet of active tenant requirements in a land-constrained market.​

Source: JLL Research

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