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Cincinnati Industrial's Supply Shortage Relief in Sight
Alongside the typical holiday-season lull, the Cincinnati industrial market is still playing catch-up with the strong demand as new supply trickles in
emand in the Cincinnati market remains strong with Q4 posting more positive absorption and 10.5M SF of new supply under construction as we enter the new year. Vacancy rates remain low at 2.3% to close out the year, though the addition of 2.6M SF in new supply contributed to a 60-basis point increase from the previous quarter. Additionally, average rental rates remain high at $5.21/SF, a 10.4% increase year-over-year.
Dayton Industrial Reaching New Heights -What's Next?
The typically under-the-radar Dayton industrial market has reached new heights as it ends 2022 with a record high net absorption of more than 5.1 million SF.
In Q4 alone, Dayton saw 1.4 million SF of net absorption, partly thanks to three major build-to-suit projects being completed and occupied. However, 3.2 million SF remains under construction as we enter the new year, maintaining a near-record low vacancy rate of 3.4%, a drop of 140 basis points year-over-year.
Strong Demand Continues to Drive Unprecedented Activity
Sustained demand pushed the market even higher for another record-breaking quarter.
The first quarter of 2022 ended with historically low vacancy,
raising questions as to how low it can go. Strong demand and
market activity resulted in the overall vacancy rate dropping by a
full percentage point to 2.3%. New supply was relatively light again with 870,600 square feet of space being delivered. This was expected as most of the space under construction, currently totaling 11.4 million square feet, is forecasted to be delivered during the second half of the year and into 2023.
Firing On All Cylinders Within the Cincinnati Industrial Market
Unwavering demand continues to spill into 2022, pushing the market to new heights in spite of increasing supply shortages.
The surge in activity that the Cincinnati industrial market
saw in previous quarters, carried over into 2022. New supply was light with only 60,000 square feet of deliveries. Net absorption fell 53% to a positive 3.2 million square feet with vacancy dropping to an all-time low of 3.3% from 4.5%. Strong demand paired with low supply placed downward pressure on vacancy rates.
Activity Remains Steady as New Construction Approaches Completion
Developers across the Greater Cincinnati market continue to remain in overdrive working to satisfy the insatiable demand for industrial space.
The Greater Cincinnati industrial market continues to remain quite active as we enter Q4. Though last quarter’s growth wasn’t as staggering as what we saw in 2021, activity shows no intention of letting up during the fourth quarter. The overall market vacancy rate fell by an additional 50 basis points to end the third quarter at 1.7%. The overall net absorption rose to 2.5 million SF.
Dayton Remains on Track for Near Record Year Despite Lull in Absorption
After many years of being a forgotten market regarding the speculative building space, Dayton has come into its own.
At the close of Q3, Dayton’s industrial market appears to remain on track for a near-record year, adding more positive absorption. While no new supply became available in Q3—leading to a misleading drop in absorption between Q2 and Q3—4.2 million SF remains under construction. This short-term lack of supply also played a role in the market’s vacancy rate dropping to a historic 3.3%, down 40 basis points from Q2.