NAIOP Industrial Space Demand Forecast
The NAIOP Research Foundation has published the NAIOP Industrial Space Demand Forecast for Q3 2021.
Demand for industrial real estate continues to be strong as the long-term trend toward e-commerce (and away from in-store sales) continues with no end in sight.
- The report’s authors forecast that total net absorption in the second half of 2021 will be 162.6 million square feet with a quarterly average of 81.3 million square feet. In 2022, the projected net absorption is 334.6 million square feet with a quarterly average of 83.6 million square feet.
- Led by coastal port cities, industrial transaction prices per square foot are on the rise, vacancy rates remain low and new leases are being signed at higher rates.
- Strong returns on industrial real estate have continued to attract investment in the sector, contributing to higher transaction prices and additional development.
If the uptick in COVID-19 infections due to the Delta variant continues, consumers could again shift more of their purchases from in-person stores and services to e-commerce, which would support additional demand for industrial real estate