2021 NORTH AMERICAN INDUSTRIAL OUTLOOK
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EXECUTIVE SUMMARY 1 Industrial demand is booming, but so is supply 2 Pent-up demand story forming— expect economic surge in back half of 2021 3 Fundamentals to continue generating solid rent growth throughout the next few years 4 Global trade expected to rise as economic growth accelerates and trade tensions ease, boosting demand For a deep dive into local market fundamentals click here.
NORTH AMERICAN INDUSTRIAL OUTLOOK 2019 2021 NORTH AMERICAN INDUSTRIAL OUTLOOK MARKET OVERVIEW increase of only 130 basis points (bps) over year-end 2020. Despite the forecasted The Industrial Market uptick, North American vacancy will remain is Still Hungry for Space nearly on par with its 10-year average (2012- The forecast for North American industrial 2021) of 6%. Average net asking rents for absorption from 2021 to 2022 is a healthy classes of industrial product will rise to a new 481.3 million square feet (msf). New supply— nominal high of $6.97 per square foot (psf) which has surpassed demand two years in at year-end 2022. Supply-side constraints, a row—will maintain this trend over the next such as onerous municipal approval two years. New deliveries are projected to processes, will continue to constrain supply reach 697.3 msf of product from 2021 to growth in Canada where overall net rents will 2022. Nonetheless, North American vacancy remain the highest in North America at USD will remain low, ending 2022 at 6.2%—an $10.19 psf by the close of 2022. NORTH AMERICAN SUPPLY AND DEMAND 400 12.0% 300 10.0% 200 8.0% MSF 100 6.0% - 4.0% (100) 2.0% (200) 0.0% New Supply (MSF) Net Absorption (MSF) Overall Vacancy (%) Source: Cushman & Wakefield Research 4 / CUSHMAN & WAKEFIELD
TOP 5 MARKETS FOR DEMAND TOP 5 MARKETS FOR SUPPLY NET ABSORPTION (MSF) DELIVERIES (MSF) 2021-2022 2021-2022 RANK MARKET MSF RANK MARKET MSF 1 Dallas/Ft. Worth, TX 47.0 1 Dallas/Ft. Worth, TX 41.4 2 Chicago, IL 31.4 2 Chicago, IL 34.3 3 Atlanta, GA 30.2 3 Inland Empire, CA 33.5 4 Inland Empire, CA 20.1 4 Atlanta, GA 29.9 5 Houston, TX 21.8 5 Memphis, TN 26.0 The economic recovery, progress in global to 2022. Over the next two years, Toronto trade and the accelerated buildout of and Vancouver are expected to account for e-commerce and 3PL last-mile facilities, over 71.8% of Canadian occupancy growth, fulfillment centers, and bulk warehouses but Ottawa will grow most rapidly (demand will reinforce demand for industrial real relative to inventory) over the same period. estate. For the eighth consecutive year, net Despite the extremely tight vacancy rates in absorption in the U.S. will exceed 200 msf Mexico, positive net absorption will continue in 2021; we anticipate this streak will extend with Mexico City approaching 9 msf of absorption by 2022. through 2022. In Canada, industrial markets will maintain their longest uninterrupted New leasing activity in Mexico City continues period of positive net absorption through to be strong. But with one of the lowest 2022 with a near record high in 2021. vacancy rates among North American Canadian industrial markets are forecast to markets in 2020, stronger occupancy gains register 38.1 msf of net absorption from 2021 will be limited to new construction deliveries NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 / 5
NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 coming to market. This is also true for the other main industrial markets in Mexico, such as Monterrey, Tijuana and Ciudad Juarez, where availability rates decreased significantly throughout 2020. Demand for industrial space in Mexico will benefit from the U.S.-Mexico-Canada Agreement (USMCA) that went into effect mid-year 2020. As an example, the auto industry will create additional real estate demand as well as jobs for the sector. The USMCA now requires that 75% of a vehicle’s components be manufactured within North America, up from around 60% under the North American Free Trade Agreement (NAFTA). It also now mandates that 70% of a vehicle’s aluminum or steel come from the three countries. These changes will help bolster manufacturing and logistics demand throughout North America. Demand in the North American industrial market is geographically dispersed, especially throughout the United States. The top 10 markets for demand include at least one market from the four Census regions tracked in the U.S. industrial market (Northeast, Midwest, South and West). Coming in at the number one spot with 47 msf of positive absorption through 2022 is the Dallas/Ft. Worth market which experienced explosive growth over the past decade of expansion, significantly outpacing Demand in the the next three top markets Chicago, Atlanta and the Inland Empire, whose forecasts North American are over 30 msf. Though this is nothing to industrial market be wary of, these four markets alone are anticipated to make up 29% of demand is geographically for North America from 2021 to 2022. dispersed, especially Regionally, the majority of demand will come from the South region in the U.S., throughout the accounting for 38% of demand, followed by United States. the West and the Midwest regions. With port proximity, rail access and established border markets, the South will continue to lead the North American industrial markets. 6 / CUSHMAN & WAKEFIELD
NORTH AMERICA AS A PERCENT OF INVENTORY 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020F 2021F 2022F -0.5% -1.0% -1.5% Absorption as a % of Inventory Delivieries as a % of Inventory Source: The CoStar Group (for select markets only), Cushman & Wakefield Research More Supply Means More Options are build-to-suit. As a result, we anticipate a North American industrial markets are slow rebalancing in market conditions with projected to deliver 697.3 msf of new a gradual uptick in vacancy. Regionally, the product by year-end 2022. Over 92% of South in the U.S. again comes in first for the the space delivered will be in the U.S. largest number of deliveries, forecasted to where the market has been strapped for deliver nearly 225 msf of new construction quality product over the past few years. by year-end 2022. However, Mexico City Despite supply being forecasted to outpace is expected to deliver the most space as a demand for the next two years, the pipeline percent of total inventory at 5%. will remain elevated in primary industrial markets, port-proximate markets (both North American demand overall is expected intermodal and maritime), and in markets to trail supply by about 125 msf in 2021 with dense or fast-growing populations. and 90 msf in 2022, causing vacancy rates Up until Q1 2019, supply had not outpaced to rise modestly from current record low demand; but this trend has started to change levels. Mexico City, however, will see a 90- with investors questioning whether the bps decrease in vacancy from 2020 to U.S. would enter a period of overbuilding year-end 2022, bringing the rate to 2.1%. while Canadian markets and Mexico City Canadian markets will likely see only a remain stable. The short answer is it did not 30-bps increase in vacancy due to a larger happen in 2020, and likely will not in 2021. pipeline of 44 msf expected to deliver over The amount of space that has been under the next two years. Vacancy in the U.S. will construction in North America exceeded surpass 6% for the first time since 2015 by 365 msf during 2020—the largest amount of year-end 2021, coming in at 6.1%, and is likely space ever under construction, and most of to increase by an additional 50 bps during that space was in the U.S. which averaged 2022 to 6.6%. Most markets across the three a pipeline of 335.9 msf on a quarterly basis. countries remain starved for quality space, The pipeline may sound concerning with and as more supply enters the market, rental the level of demand not keeping up, but rates are expected to continue increasing, the circumstances around the deliveries are albeit at a slightly slower pace. With options fundamentally better than in the past. Pre- becoming more plentiful, tenants can afford leasing rates indicate this will continue, plus, to be picky when it comes to site selection, the composition of supply matters. A much forcing landlords to slow increases in rental higher percentage of projects in the pipeline rates to remain competitive. NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 / 7
NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 Rents Will Reach New Highs as Dallas/Ft. Worth, Inland Empire, Atlanta, North American industrial asking rents Chicago, PA I-81/I-78 Distribution Corridor, are expected to reach a new nominal high Indianapolis and Central New Jersey. The of USD $6.97 psf by year-end 2022, and demand for newer product will command the growth will be broad based across a premium and gives landlords the option many markets in all regions. Across North to raise prices for the most competitive American industrial markets, 29 markets tenants. But also expect to see higher are forecast to register more than 10% rent rents among supply-constrained markets, growth from the beginning of 2021 to year- especially those close to ports (both inland end 2022, with two of the top three being and maritime) such as Los Angeles, Seattle, Canadian: Toronto at 25% and Vancouver San Francisco Peninsula and Orange County. at 23.9%. All but nine (of the 85) markets The markets being fed by the West and tracked for this report will see positive East Coast ports or the intermodal hubs in rent growth through 2022. Other North the middle of the country are where U.S. American cities that will post some of the rent growth will be strongest due to limited strongest rent growth will be those with the supply and desirable location. highest demand and quality supply such NORTH AMERICAN RENT GROWTH $8.00 8.0% $7.00 6.0% $6.00 4.0% $5.00 2.0% $4.00 0.0% $3.00 -2.0% $2.00 -4.0% $1.00 -6.0% $0.00 -8.0% Asking Rents (Q4) (USD/SF) Rent Growth (USD, %) Source: Cushman & Wakefield Research 8 / CUSHMAN & WAKEFIELD
COVID-19 & THE of the global and regional economy. Indeed, the next few years may be defined by a ECONOMY period of strong, synchronized global growth 2020 was rough, but is setting the similar to 2017. Once the pandemic largely stage for a global rebound subsides, that is. COVID-19 disrupted everything in 2020. And with its onset more than one year behind Supporting the near-term recovery are the globe, and the arrival and approval of three key features: less restrictive lockdown multiple viable vaccines, the stage for a measures (which immediately led to a jump rebound in the global economy is being set. in economic growth across the globe but As North America scales up access to several have since contributed less momentum), vaccines, and warmer weather more easily demand from regions that have had more allows for businesses to operate (particularly relative success in containing COVID-19, outdoors), even under social distancing and policy support. For example, bilateral protocols, economic momentum is likely to merchandise trade flow data from the build throughout the spring. Not only that, International Monetary Fund show that but a few other forces are liable to stimulate exports from Canada are down 14% year-to- demand in the economy: 1) inventory draw- downs in 2020 will need to be replenished, date (January through August). For Mexico, 2) pent-up demand for tourism and other they are down 17% and for the U.S., 16%. services will start to be unleashed, 3) global But, when looking at exports to mainland demand will support the budding trade China, where containment of the virus has recovery and 4) the ability to congregate allowed for a much faster return to normalcy, again will mean that these trends benefit a Canada’s exports are only down 1%, Mexico’s wider segment—possibly even the totality— are up 8% and the U.S.’s are only down 7%. REAL GDP FORECASTS Annual growth rate 2020Q4-2022Q4 CAGR 8.0% 3.3% 3.4% 4.2% 4.0% 4.4% 6.0% 4.0% 2.0% 0.0% -2.0% -4.0% -6.0% -8.0% -10.0% Canada Mexico United States North America Global 2017 2018 2019 2020 2021 2022 Source: Oxford Economics, Cushman & Wakefield Research Note: Country real GDP figures based on data in local currency units. North American real GDP figures in PPP units. NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 / 9
NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 Policy actions holding up economy, June, an expansion of 71%. It has remained for now roughly stable since then. The Bank of North America’s near-term recovery is being Canada’s balance sheet expanded from supported by policy measures that have C$121.5 billion to over C$500 billion over been disproportionately large in the U.S. and the same time period, and was at C$544.8 Canada relative to Mexico. The U.S. passed billion, an increase of nearly 350%, as of mid- five major pieces of legislation in response December. Because each country’s economy to COVID-19, totaling over $4 trillion of is operating so far below its potential, and direct and indirect stimulus, or 19.4% of with aggregate demand subdued by hard-hit pre-COVID-19 GDP. Canada has provided sectors, few central banks are worried about $320 billion of such support for its economy, reversing course to fight inflation. Indeed, representing 18.4% of its pre-COVID-19 GDP the outlook for interest rates has softened level. Despite Mexico’s somewhat lackluster considerably from pre-COVID-19, supporting fiscal response totaling $9.4 billion, or 0.7% inflows of capital to yield-producing assets, of its pre-COVID-19 GDP, it has indisputably such as commercial real estate. benefitted from its northern neighbors’ actions through regional linkages. Further, all Mexico’s central bank, Banco de México, had three countries’ central banks substantially a substantially different starting point; it had altered policy in response to the pandemic. raised interest rates to 8.25% by mid-2019 to combat falling currency values and high Unconcerned with inflation, almost all major central banks went on offense in early inflation. Having started to lower rates in 2020. The U.S. Federal Reserve’s Federal August 2019, it quickly accelerated its easing Open Market Committee (FOMC) lowered and lowered the target interbank rate from its target rate to a range of 0% to 0.25% 7.0% to 4.25% over the course of 2020 in a while the Bank of Canada lowered its rate to more gradual set of rate cuts than Canada 0.25%. A rapid increase in quantitative easing and the U.S undertook. This is in part due to was accompanied by the deployment of its strict inflation mandate, as Mexico’s core multiple credit facilities to stabilize financial inflation has remained above 3% throughout market conditions. The Federal Reserve’s 2020. Still, the current rate is below the balance sheet grew from $4.2 trillion at estimate-neutral rate, meaning that monetary the end of February to $7.2 trillion by mid- policy conditions are expansionary. FISCAL SUPPORT AS A PERCENT OF 2019 GDP Policy Buoys 2020 Economy U.S. Canada Mexico 0 2 4 6 8 10 12 14 16 18 20 Direct Fiscal Support Liquidity Support Source: Moody’s Analytics 10 / CUSHMAN & WAKEFIELD
North American demand Stronger, unique recovery overall is expected to trail to accelerate in 2021 With accommodative policy bridging the supply by about 125 msf in economic chasm and inoculation currently 2021 and 90 msf in 2022, ramping up, it is likely that 2021 will be a turning point, particularly in the stability of causing vacancy rates to the outlook. It is assumed that current and rise modestly from current forthcoming vaccines will be successful in not only preventing COVID-19 outbreaks, with record low levels. obvious economic repercussions, but that this also allows for more sustainable private sector growth, having gradually decoupled from the persistently high levels of uncertainty of 2020. And while growth will no longer be as closely linked to the virus itself and its concomitant policy responses, COVID-19 will nonetheless influence the foundation of the next expansion. One such theme is that of an uneven recovery. Already this is being seen across industries and across wage tiers—with those hurt most by social distancing seeing the least robust improvements. This has been particularly true of the tourist-centric and service-oriented industries as well as those in low-wage jobs across all sectors. In Mexico, the tertiary sector, which employs about three-fifths of workers, has also been hard hit. An uneven recovery is even taking hold within the industrial segment of the economy, with manufacturing, wholesale and various forms of transportation employment all still well below pre-COVID-19 peak levels. These sectors are sensitive to flows of inputs and final goods that trend with global demand, manufacturing, and trade activity. Although global growth is expected to rebound in 2021, growing by 5.1% according to a consensus of forecasts,1 it is not expected to recover until the second half of 2021 (and that is only to pre-COVID-19 levels, not to the level that would have been achieved in the absence of a global recession). The World Trade Organization estimates that world trade will grow by 7.2% 1 The average of the International Monetary Fund, the Organi- zation for Economic Co-operation and Development, Oxford Economics and Moody’s Analytics. NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 / 11
NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 UNEVEN RECOVERY MEXICO U.S. EMPLOYMENT INDEX: YR/YR % CHANGE IN EMPLOYMENT JAN 2020 LEVEL = 100 BY WAGE TIER 105 May-20 Aug-20 Feb-20 Mar-20 Apr-20 Sep-20 Jun-20 Oct-20 Jan-20 Dec-19 Jul-20 100 95 5% 90 0% 85 -5% 80 -10% 75 -15% 8/1/2020 6/1/2020 9/1/2020 4/1/2020 7/1/2020 2/1/2020 3/1/2020 1/1/2020 5/1/2020 -20% -25% -30% Primary and Secondary Sectors Tertiary Sector High-Wage Mid-Wage Low-Wage CANADA PRE-COVID-19 PEAK TO TODAY % CHANGE IN EMPLOYMENT Professional; scientific and technical services Educational services Finance; insurance; real estate and leasing Forestry; fishing; mining; quarrying; oil and gas Utilities Public administration Manufacturing Health care and social assistance Trade Goods-producing sector Total Services-producing sector Other services Construction Transportation and warehousing Agriculture Business; building and other support services Information; culture and recreation Accommodation and food services -25% -20% -15% -10% -5% 0% 5% Source: Statistics Canada, Instituto Nacional de Estadística Geografia e Informática (INEGI), Encuesta Nacional de Ocupación y Empleo (ENOE), U.S. Bureau of Labor Statistics, Moody’s Analytics 12 / CUSHMAN & WAKEFIELD
in 2021, only partially offsetting the loss of demand. Importantly, the structural shifts of activity in 2020.2 The global recovery is in consumer behavior will also mean that expected to be led by the East, with China industrial property markets are likely to see and India seeing faster improvements in healthy demand despite underlying pockets industrial production and trade than the of weakness in the broader labor market. West. This suggests industrial demand drivers will remain below their potential in 2021 due to a lack of a comprehensive CONCLUSION recovery across all sectors. More diverse The necessity to further accelerate the demand should return in 2022. adoption of e-commerce within the economy insulated the industrial real estate sector from The strength in industrial real estate the downturns that befell the hospitality, throughout the pandemic has been a office and retail sectors. This ramping up of function of pulling forward e-commerce- the industrial sector to support e-commerce related demand due to simple necessity. The pandemic-induced surge in online growth will benefit industrial real estate in shopping created a bifurcation in industrial the near- and medium-term but may also employment, with warehousing and final- lead to slower growth in 2022 as the sector mile employment reaching record levels in compensates for overshooting due to the the U.S. In Canada, warehouse and final-mile partly unforeseen spike in demand. Given that employment has outperformed significantly, the global economy is expected to be firing only 5% below pre-COVID-19 levels (versus on all cylinders by that time, demand from nearly 20% for overall employment). As the other segments of the economy is likely to growth of e-commerce demand slows from accelerate and offset any e-commerce-specific its feverish pace during the height of the loss of momentum. Thus, the stage is set for a pandemic, it will remain a significant source healthy and evolving demand backdrop. 2 https://www.wto.org/english/news_e/pres20_e/pr862_e.htm NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 / 13
INDEX TOP 50 MARKETS FOR SUPPLY DELIVERIES (MSF) 2021-2022 RANK MARKET MSF RANK MARKET MSF 1 Dallas/Ft. Worth, TX 41.4 26 Nashville, TN 7.0 2 Chicago, IL 34.3 27 Denver, CO 6.3 3 Inland Empire, CA 33.5 28 Northern NJ 5.8 4 Atlanta, GA 29.9 29 San Diego, CA 5.7 5 Memphis, TN 26.1 30 Las Vegas, NV 5.7 6 Houston, TX 25.0 31 Seattle, WA 5.4 7 Indianapolis, IN 21.0 32 San Antonio, TX 5.3 8 Toronto, ON 20.7 33 Minneapolis, MN 5.2 9 PA I81/I78 Corridor, PA 20.6 34 Central Valley, CA 4.9 10 Phoenix, AZ 18.3 35 Ottawa, ON 4.6 11 Austin, TX 14.2 36 Jacksonville, FL 4.3 12 Kansas City, MO 14.0 37 Salt Lake City, UT 4.2 13 Vancouver, BC 13.5 38 Colorado Springs, CO 4.1 14 Central NJ 11.8 39 Fort Lauderdale, FL 3.8 15 Philadelphia, PA 11.7 40 Silicon Valley, CA 3.6 16 Charlotte, NC 10.9 41 DC Suburbs, VA 3.6 17 Columbus, OH 9.7 42 Lakeland, FL 3.6 18 Norfolk, VA 8.2 43 Reno, NV 3.5 19 Miami, FL 7.9 44 Calgary, AB 3.4 20 Savannah, GA 7.8 45 Louisville, KY 3.2 21 Baltimore, MD 7.7 46 San Francisco Peninsula, CA 3.2 22 St. Louis, MO 7.6 47 Sacramento, CA 2.8 23 Los Angeles, CA 7.3 48 Oakland, CA 2.8 24 Tampa, FL 7.2 49 Orlando, FL 2.5 25 Cincinnati, OH 7.2 50 NYC Boroughs, NY 2.5 Source: Cushman & Wakefield Research, The CoStar Group *2021-2022 figures are derived from CoStar’s forecasts. 14 / CUSHMAN & WAKEFIELD
TOP 50 MARKETS FOR DEMAND NET ABSORPTION (MSF) 2021-2022 RANK MARKET MSF RANK MARKET MSF 1 Dallas/Ft. Worth, TX 47.0 26 San Diego, CA 5.4 2 Chicago, IL 31.4 27 Norfolk, VA 5.3 3 Atlanta, GA 30.2 28 Central Valley, CA 4.9 4 Inland Empire, CA 30.1 29 San Antonio, TX 4.5 5 Houston, TX 21.8 30 Cincinnati, OH 4.4 6 Indianapolis, IN 19.1 31 Seattle, WA 4.4 7 PA I81/I78 Corridor, PA 19.0 32 Jacksonville, FL 4.1 8 Memphis, TN 15.1 33 Salt Lake City, UT 3.9 9 Central NJ 15.1 34 Montreal, QC 3.9 10 Kansas City, MO 14.6 35 Colorado Springs, CO 3.9 11 Toronto, ON 14.1 36 Minneapolis, MN 3.9 12 Phoenix, AZ 13.8 37 Reno, NV 3.8 13 Vancouver, BC 13.3 38 Louisville, KY 3.7 14 Austin, TX 9.4 39 Charleston, SC 3.7 15 Los Angeles, CA 7.2 40 Ottawa, ON 3.6 16 Charlotte, NC 7.1 41 Columbus, OH 3.3 17 St. Louis, MO 6.6 42 Fort Lauderdale, FL 3.3 18 Savannah, GA 6.4 43 Calgary, AB 3.2 19 Nashville, TN 6.3 44 Las Vegas, NV 3.1 20 Silicon Valley, CA 6.2 45 San Francisco Peninsula, CA 2.9 21 Denver, CO 6.1 46 Miami, FL 2.7 22 Philadelphia, PA 5.8 47 Oakland, CA 2.6 23 Northern NJ 5.8 48 Sacramento, CA 2.5 24 Tampa, FL 5.5 49 Orlando, FL 2.5 25 Baltimore, MD 5.5 50 Lakeland, FL 2.4 Source: Cushman & Wakefield Research, The CoStar Group *2021-2022 figures are derived from CoStar’s forecasts. NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 / 15
INDEX TOP 50 MARKETS FOR RELATIVE DEMAND & SUPPLY DELIVERIES AS % OF INVENTORY 2021-2022 1 Ottawa, ON 19.2% 26 Las Vegas, NV 3.8% 2 Austin, TX 13.0% 27 San Antonio, TX 3.6% 3 Colorado Springs, CO 11.3% 28 Baltimore, MD 3.5% 4 Savannah, GA 9.4% 29 San Diego, CA 3.5% 5 Memphis, TN 9.0% 30 Reno, NV 3.4% 6 Philadelphia, PA 7.4% 31 Central NJ 3.3% 7 Indianapolis, IN 7.3% 32 Nashville, TN 3.2% 8 Norfolk, VA 6.8% 33 Columbus, OH 3.1% 9 Charlotte, NC 6.7% 34 St. Louis, MO 3.0% 10 Tampa, FL 6.4% 35 Chicago, IL 2.9% 11 PA I81/I78 Corridor, PA 6.3% 36 DC Suburbs, VA 2.8% 12 Vancouver, BC 6.2% 37 Calgary, AB 2.6% 13 Kansas City, MO 6.0% 38 Salt Lake City, UT 2.6% 14 Inland Empire, CA 5.8% 39 Toronto, ON 2.6% 15 San Francisco Peninsula, CA 5.6% 40 Central Valley, CA 2.6% 16 Houston, TX 5.5% 41 Denver, CO 2.6% 17 Phoenix, AZ 5.4% 42 Charleston, SC 2.4% 18 West Palm Beach, FL 5.2% 43 Seattle, WA 2.3% 19 Dallas/Ft. Worth, TX 5.1% 44 Cincinnati, OH 2.1% 20 Lakeland, FL 4.9% 45 Orlando, FL 2.1% 21 Miami, FL 4.9% 46 Northern NJ 2.0% 22 Atlanta, GA 4.6% 47 Fort Myers/Naples, FL 1.9% 23 Minneapolis, MN 4.4% 48 Sacramento, CA 1.9% 24 Fort Lauderdale, FL 4.2% 49 Fredericksburg, VA 1.8% 25 Jacksonville, FL 4.2% 50 Silicon Valley, CA 1.6% Source: Cushman & Wakefield Research, The CoStar Group *2021-2022 figures are derived from CoStar’s forecasts. 16 / CUSHMAN & WAKEFIELD
TOP 50 MARKETS FOR RELATIVE DEMAND & SUPPLY NET ABSORPTION AS A % OF INVENTORY 2021-2022 1 Ottawa, ON 15.1% 26 San Diego, CA 3.3% 2 Colorado Springs, CO 10.7% 27 Minneapolis, MN 3.3% 3 Austin, TX 8.6% 28 Fredericksburg, VA 3.1% 4 Savannah, GA 7.7% 29 San Antonio, TX 3.0% 5 Indianapolis, IN 6.6% 30 Nashville, TN 2.8% 6 Kansas City, MO 6.2% 31 Silicon Valley, CA 2.7% 7 Vancouver, BC 6.1% 32 Chicago, IL 2.7% 8 PA I81/I78 Corridor, PA 5.9% 33 St. Louis, MO 2.6% 9 Dallas/Ft. Worth, TX 5.8% 34 Central Valley, CA 2.5% 10 Inland Empire, CA 5.3% 35 Baltimore, MD 2.5% 11 San Francisco Peninsula, CA 5.2% 36 Salt Lake City, UT 2.5% 12 Memphis, TN 5.2% 37 Denver, CO 2.5% 13 Tampa, FL 4.9% 38 Calgary, AB 2.4% 14 Houston, TX 4.8% 39 West Palm Beach, FL 2.2% 15 Atlanta, GA 4.7% 40 Orlando, FL 2.1% 16 Charlotte, NC 4.4% 41 SF North Bay, CA 2.1% 17 Norfolk, VA 4.4% 42 Las Vegas, NV 2.0% 18 Central NJ 4.1% 43 Northern NJ 2.0% 19 Charleston, SC 4.1% 44 Seattle, WA 1.9% 20 Phoenix, AZ 4.1% 45 DC Suburbs, VA 1.8% 21 Jacksonville, FL 4.0% 46 Toronto, ON 1.8% 22 Reno, NV 3.7% 47 Sacramento, CA 1.7% 23 Philadelphia, PA 3.7% 48 Miami, FL 1.7% 24 Fort Lauderdale, FL 3.7% 49 Louisville, KY 1.6% 25 Lakeland, FL 3.3% 50 Fort Myers/Naples, FL 1.6% Source: Cushman & Wakefield Research, The CoStar Group *2021-2022 figures are derived from CoStar’s forecasts. NORTH AMERICAN INDUSTRIAL OUTLOOK 2021 / 17
ABOUT CUSHMAN & WAKEFIELD Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with approximately 53,000 employees in 400 offices and 60 countries. In 2019, the firm had revenue of $8.8 billion across core services of property, facilities and project management, leasing, capital markets, valuation and other services. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter. CONTRIBUTORS Carolyn Salzer Jason Tolliver Americas Head of Logistics & Global Head of Logistics & Industrial Industrial Research Research carolyn.salzer@cushwake.com Managing Director, Investor Services jason.tolliver@cushwake.com Rebecca Rockey Global Head of Economic Analysis & Kristina Bowman Forecasting National Manager of Research, rebecca.rockey@cushwake.com Canadian Markets kristina.bowman@ca.cushwake.com Rob Miller Jose Luis Rubi Senior Research Manager, Global Market Research Manager, Research Mexican Markets rob.miller@cushwake.com joseluis.rubi@cushwake.com FOR MORE INFORMATION Tray Anderson Logistics & Industrial Services Lead, Americas tray.anderson@cushwake.com Bethany Clark Senior Managing Director, Strategy & Operations - Logistics & Industrial Services, Americas bethany.clark@cushwake.com © 2021 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources believed to be reliable. The information may contain errors or cushmanwakefield.com omissions and is presented without any warranty or representations as to its accuracy.
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