Cleveland industrial market report
The Cleveland industrial market remained stable through Q4 2022 with increasing rental rates, steady leasing activity, and continued development alongside new tenants in the market. As industrial users underwent more due diligence, however, credit worthiness and desire for higher quality inventory extended the average time to close on new deals. That said, more industrial users in Ohio are considering markets like Cleveland because of concerns related to Intel’s future semiconductor plant in New Albany, including high construction costs, a tight labor market, and legislative constraints. Lastly, several major industrial projects are fueling Cleveland’s new development pipeline, including the Avon International Commerce Center, Turnpike Commerce Center, and Forward Innovation Centers.
Net absorption in 2022 totaled +5.8 msf, which is 1.2 msf higher than the net absorption of the previous four years combined (4.6 msf).
As of October 2022, employment levels for industrial-related jobs were 3.3% higher than they were in February 2020. Not all industrial sectors have experienced equal growth, but all have seen improvement since the onset of the pandemic.
Cleveland averaged 4.2 msf of product under construction per quarter in 2022. That amount is 42% higher than the 2.9 msf quarterly average from 2018 to 2021. This quarterly average has been climbing since 2020 and is setting up the market for a flood of new deliveries.
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