As capital has become scarcer and more expensive, industrial construction starts and sales have slowed down in 2023.
The sales volume dropped significantly compared to the $55 billion recorded during the same period last year.
New starts continued to moderate across top industrial markets in the U.S., with few exceptions, such as Phoenix and Dallas.
While the amount of space under construction remained high, new starts have started to slow, reflecting the current economic issues.
Although transaction activity slowed considerably in Q1, industrial remains among the most desirable asset classes.
Albeit transactions slowed across commercial real estate sectors, the first two months of the year saw $3.9 billion in industrial sales.
Industrial leases signed in the last 12 months reached a national average of $9.01 per square foot, $1.88 more than in-place contracts.
While industrial deliveries hit a new high in 2022, supply is still behind demand, and 2023 is set to be another robust year for development.
More than 742 million square feet of industrial space was under construction at the end of November as demand continues to outstrip supply.
National industrial in-place rents averaged $6.95 per square foot, up 5.8% year-over-year as demand remains strong
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