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Smaller format industrial rents in Puget Sound market are volatile

  • ​Smaller format industrial buildings located in or near urban areas are an important  piece of last mile delivery that tends to prioritize locations close to population centers.  With 50 percent growth in last mile services in the United States over the last 18 months, there is an increasing demand for industrial spaces that support these business-to-consumer and business-to-business services.

  • In the Puget Sound market, rents in smaller format industrial space (15,000 to 50,000 square feet) have been more volatile than overall industrial rents over the last 5 years.

  • In 2016, the number of smaller format industrial leases in the Pierce County and Eastside markets was up, but the majority (69.0 percent in 2017) of smaller format industrial leasing continues to occur in the Kent Valley where more inventory exists. 

  • Due to a constrained supply of smaller industrial spaces in urban areas and a growing demand for these spaces that support consumer demands for short-term delivery, the Puget Sound market will likely see a continued rise in average rents for smaller format industrial spaces.

Source: JLL Research; Eye for Transport

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