The industrial sector is navigating a robust and sometimes volatile growth trajectory, as unprecedented demand fuels intense leasing, development and capital markets activity across the U.S. With the national vacancy rate around 4% and markets such as Los Angeles seeing rates dip to 1%, the supply-demand imbalance is creating a frenzied environment, as rents rise and cap rates compress.
Key findings of the 2021 LightBox-SIOR Investment Sentiment Report include:
- E-commerce will continue to drive industrial space usage for the foreseeable future.
- Rents are expected to rise by 5% to 7% or more in 2022.
- Large portfolios, particularly those tied to logistics, are in great demand. .
- Industrial construction continues at a strong pace.
- Supply chain disruption, rising construction costs and material and labor shortages are key headwinds for the sector.