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U.S. Industrial Market Outlook Report | Q1 2024

May 16, 2024

U.S. Industrial Demand Fell in Q1 but Will Build as New Supply Falls

Industrial construction completions outstripped tenant demand for the seventh quarter in a row, pushing the U.S. average vacancy rate up 50 basis points, to 6.1% during the first quarter of 2024 — the highest since early 2015. Vacancy was highest in the South region at 7.4%, 68 basis points higher during the quarter, and increased in 61 of the 77 markets tracked by Colliers between January and March. Net absorption was the lowest quarterly total in over a decade at 28 million square feet (SF), and 65% lower than the 81 million SF absorbed in the first quarter of 2023.

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