#62 – Inside Our Industry – NAIOP Study: Industrial Demand Still Outpaces Supply
Posted on | Inside Our Industry
Just a couple of weeks ago we shared information from a Transwestern Real Estate Services report regarding the absorption of industrial space. This week we are sharing NAIOP’s report that says much the same, but also looks at what to expect in 2022. As we noted earlier this month, industrial space absorption is a key metric for Agracel as we gauge what types of development we expect to see in the future.
NAIOP Study: Industrial Demand Still Outpaces Supply
Paul Bubny | connectcre.com | August 17, 2021
Driven by sustained growth in e-commerce, demand for industrial real estate continues to outpace supply, leading to increases in net absorption for the rest of the year and through 2022, according to NAIOP’s newly issued Industrial Space Demand Forecast.
“With nearly 100 million new square feet delivered nationally since the beginning of the year, 450 million square feet currently under construction and another 450 million planned, the demand for industrial real estate still outpaces supply,” say the authors, Hany Guirguis, and Michael J. Seiler.
Because of this, Guirguis and Seiler 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, they project net absorption of 334.6 million square feet, averaging 83.6 million square feet per quarter. They’ve returned to their pre-pandemic confidence intervals now that economic conditions have become more predictable.