U.S. industrial real estate availability declined in the third quarter.
Average availability rates for warehouses and distribution centers dropped by 10 basis points with demand outpacing supply again, according to a CBRE report.
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“With growth expected to remain at a similar pace for the fourth quarter and into early next year, we expect demand to remain strong. The supply pipeline is increasing, but vacancy isn’t expected to rise dramatically, and the market remains fundamentally balanced,” CBRE Americas Chief Economist Jeffrey Havsy said in a statement.
U.S. industrial availability decreased by 0.1% to 7.7% in Q3, down from 7.8% in Q2 and 7.9% in 2016.
Q3 net absorption of industrial space came in slightly less than the two-year average at 61M SF, while construction completions came in higher than the two-year average for new supply with almost 51M SF during the three-month period.
Economic and industry indicators including gross domestic product growth and gains in warehouse employment have analysts anticipating this momentum in the U.S. industrial market will continue in the coming months.
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