4Q20 Charlotte Industrial Market Report4 Mar 2021
Charlotte’s industrial market capped off a tumultuous year on a high note, with 2 msf of positive net absorption in the fourth quarter bringing the 2020 total to 5.3 msf, up 123% over 2019. Vacancy ended the year at 7.2%, up 70 bps year-over-year but on a downward track versus 3Q20. The first half of the year was marked by a surge in construction deliveries and a pause in leasing activity in response to COVID-driven stay-at-home orders. More than 7.6 msf of new space was delivered in 2020, and Charlotte’s inventory has grown by 15% in the last five years. Tenant demand came roaring back by the third quarter as e-commerce activity spiked and companies scrambled to address supply chain vulnerabilities laid bare by the pandemic. The greatest single contributor to the market’s strong year-end performance was Walmart’s acquisition of a recently delivered 1-msf distribution facility in Iredell County. The building was constructed on a speculative basis in an effort to capture demand from tenants increasingly seeking larger footprints.