Industrial Sector Net Absorption Surges During Third Quarter, Colliers Reports
By Michael Tucker
Industrial activity ‘surged' in the third quarter, led by demand from the third-party logistics and packaging industry, reported Colliers International, Toronto.
The sector set records for rent per square foot and for breaking the 5 percent vacancy rate, Colliers said.
More than 76 million square feet of space was absorbed during the quarter, the third-highest quarter on record, noted Colliers National Director of Industrial Research James Breeze. This brought year-to-date overall net absorption to 203 million square feet, up more than 11 percent compared to last year.
"With this activity, the market is well on its way to having its second-best year ever for occupancy gains," Breeze said. He noted robust demand dropped the overall vacancy rate to 4.9 percent, the first time the industrial market has posted a sub-5 percent vacancy rate. This continued activity and record low vacancies combine to drive up asking rents, which finished the quarter at a record $5.91 per square foot per year for warehouse/distribution space.