Availability gap for class A and B in Charlotte industrial infill continues to grow

– Over the last 6 months, Charlotte’s infill submarkets have experienced a widening gap in availability by class. Over 9 msf of Class A product is available, compared to less than 3 msf Class B product. As a result of nearly 13 msf of new supply delivered over the past 3 years, the spread between the two classes continues growing. This roughly 7 million square foot gap is a 46% increase from Q1 2024.

– Limited land supply for future development and a flight-to-quality from occupiers does suggest the gap may have peaked, and we will see a return to a more reasonable spread. Over 5 msf was leased in Class A buildings over the last 2 years, while roughly 3.5 msf was in Class B properties.

– With 2.6 msf under construction in the infill markets, expect to see further leasing of top-quality spaces by tenants leading to a shortening of the gap in availability of each product class.