Las Vegas industrial real estate market report

Q4 2023

Three key market themes:

2.9%

Direct vacancy rate

For the past two years, the Las Vegas industrial market has maintained historically low vacancy rates, reaching 3.5% in Q4 2023 despite the delivery of 5.7 million sf in Q1 and Q2 of 2023.

This suggests strong demand, with spaces being pre-leased or quickly filled upon completion. The market's stability and control outperform others, signaling positive prospects.

-606.3k

Net absorption (sf)

After 13 consecutive quarters of positive net absorption, the Las Vegas industrial market experienced a reversal in Q4 2023, with a net absorption of -606,289 square feet. Only North Las Vegas and Southwest Las Vegas submarkets recorded positive absorption. This shift is attributed to a surge in construction over the past two years, particularly in the first two quarters of 2023, delivering 5.5 million square feet to the market. However, a slowdown occurred in Q3 and Q4, with the market witnessing a 42% increase in square footage under construction from Q1 2022 to Q4 2023.

$1.12

Direct FS asking rent (psf/mo.)

In Q4 2023, asking rents, both for direct and sublet leasing, showed a slowdown in growth, with a marginal increase of $0.01/month from Q3 to Q4. Despite significant growth in 2021, the market's momentum seems to be stabilizing. Throughout 2023, there were fluctuations in direct rents, but overall, asking rents only grew by 2%, rising from $2.05 psf/month to $2.01 psf/month, combining both direct and sublet values.

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