The industrial market is shifting. Tenants who understand these dynamics will negotiate better deals. Tenants who don't will overpay for the wrong space.
US manufacturing construction spending hit $236B in 2025 — triple the 2019 level. Companies relocating production from Asia need facilities now, not in 18 months. The competition for manufacturing-grade space is intensifying in every major US industrial corridor.
With tariff policy shifting unpredictably, distribution tenants need lease structures that allow expansion, contraction, and early exit without catastrophic penalties. Standard 10-year NNN with no outs is a liability, not a commitment.
Between AI data centers, EV charging, and automation systems, industrial power demand is outstripping utility capacity in key markets. Buildings with 4,000A+ service and utility expansion paths are trading at premiums. If you're not evaluating power first, you're touring buildings you can't use.
Robotic fulfillment systems need 40'+ clear, flat floors (FF50+), and heavy power — specs that eliminate 70% of existing inventory. The buildings being marketed as Class A today may not support your operations in 3 years.
After years of sub-3% vacancy in top US markets, rates are climbing toward 5-7%. This is the first real leverage tenants have had since 2019. If you're renewing or relocating in the next 18 months, your negotiating position may never be this strong again.
Large shippers and retailers are requiring carbon reporting from logistics providers. LEED-certified buildings, EV fleet charging, and solar-ready roofs aren't nice-to-haves — they're RFP requirements. Your next facility decision is also an ESG decision.