REAL ESTATE NEWS

Last year was a slow turnaround for bulk industrial, according to Colliers. New occupancies saw a jump up from 2023 even as transaction sizes were down.

In 2023, new bulk occupancies had dipped. Those greater than 100,000 square feet totaled 302 million square feet by the end of the year. That was a 47.6% drop from the 576 million square feet in 2022. New occupancies comprised 1,042 new leases and user sales compared to 1,956 in 2022.

Last year saw new industrial bulk occupancies of 307 million square feet — up 1.5% from 2023 — across 1,160 spaces of at least 100,000 square feet. The growth accelerated over 2024, with 156 million square feet in the second half of the year, 3% higher than the first half.

According to Colliers, the pattern “indicates a rebound in demand for industrial space.” The average transaction size last year was 264,251 square feet, down from 289,336 square feet in 2023 and 309,029 square feet in 2022. However, the number of transactions made up for the reduction.

The West saw the largest regional amount (95 million square feet), representing 31% of the overall total. That included 370 new bulk occupancies and was up 4.2% over 2023’s total.

The next largest was the Midwest, which generated 69 million square feet, accounting for 22% of the total amount for the year. That included 276 new occupancies, which was down 9.6% compared to 2023.

Next came the Southeast with 63 million square feet, or 21% of the total, with 250 new occupancies, up 16% compared to 2023.

In fourth place was Southcentral with 47 million square feet or 15% of the total across 148 new occupancies, which was down 9.2% from 2023.

In last place was the Northeast, with 33 million square feet and 10% of the total. That region had 116 new occupancies, up 13% from 2023.

Occupancies were up across all the size segments under 500,000 square feet. The biggest increase, 23% year-over-year, was in the 300,000 to 499,999 square foot range. In the 500,000 to 750,000 square foot range, there was a -4.3% change from 2023. Over 750,000 square feet, there was a fall of 25.8%. Between 200,000 to 299,999, there was 7.0% growth, while between 100,000 and 199,999 square feet there was 14.7% year-over-year growth.

The largest portion of bulk occupiers by industry went to third-party logistics, trucking, and transportation with 32.89% of the total. The second biggest was manufacturing, fabrication, and material processing at 14.4%. General retail and wholesale was 12.1% while food, beverage and pet supply was 8.6%. Then came vehicles, aviation, tires, and auto parts at 7.3%; building materials, construction, power equipment, and HVAC at 5.3%; e-commerce also at 5.3%; general warehousing and storage, packaging, apparel, and event production at 4.3%; data center, tech, R&D, and energy also at 4.3%; and furniture and appliances at 2.5%.

Source: GlobeSt/ALM