Industrial fundamentals are shifting as vacancy rises, rent spreads compress and development remains concentrated in key markets, the latest Yardi Matrix Industrial Report shows.
Report Highlights
- In-place rents averaged $8.94 per square foot in January, up 5.1 percent year over year.
- National vacancy rose to 9.6 percent, a 160-basis-point annual increase.
- Construction totaled 355.7 million square feet, or 1.7 percent of stock.
- Data center starts reached 30.8 million square feet in 2025.
- January sales volume hit $4.1 billion at $166 per square foot on average.
Vacancy rises as rent premium narrows
Industrial vacancy climbed to 9.6 percent in January, reflecting the continued absorption of projects delivered over the past several years. The rent gap between newly signed leases and in-place rates narrowed to $1.13 per square foot, as leases executed in the past year averaged $10.07 compared to the $8.94 national in-place figure.
Annual rent growth measured 5.1 percent nationally. Atlanta posted the strongest increase at 8.0 percent, followed by Miami (7.4 percent), Tampa (7.4 percent) and Philadelphia (6.8 percent). Rent gains remain concentrated in markets with sustained logistics demand and population growth.
Development and investment concentrated in key hubs
Total industrial space under construction stood at 355.7 million square feet in January, representing 1.7 percent of national inventory. Data center development remains a significant component of the pipeline, with 30.8 million square feet of starts recorded in 2025. Washington, D.C. (6.1 million), Dallas (3.2 million), Phoenix (2.9 million), Atlanta (2.8 million) and Columbus (2.6 million) led activity.
Industrial transactions totaled $4.1 billion in January at an average price of $166 per square foot. Pricing varied widely by market: the Bay Area ($391) and New Jersey ($252) exceeded the national average, while Chicago ($68) and Cleveland ($62) remained below. Los Angeles recorded $356 million in sales across 12 transactions during the month.
Read the full Yardi Matrix Industrial Market Outlook: February 2026.
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