Record Warehouse Rents in Q2 2023 Despite Lower Demand
U.S. warehouse rents hit record highs in Q2 2023 despite decreasing demand; long-term leases and new premium facilities influence trends.
Despite declining demand, U.S. warehouse rents reached record highs in the second quarter of 2023, with an average asking rate of $9.59 per square foot, marking a 16.1% increase from the previous year. Several factors contribute to this trend: long-term lease agreements that disregard short-term market conditions, a persistently tight warehouse space market compared to historical standards, and newly constructed facilities with premium prices. While the demand for storage has decreased, and some developers are cutting back on new projects, experts anticipate rents to continue rising, albeit at a slower pace.