Philadelphia industrial real estate market reports
Q4 2024
17.9 msf
Total new product delivered in 2024
Following a record breaking three years, with an average of 42.5 msf in annual new product deliveries, 2024 saw a return to pre-pandemic levels of new deliveries. The Philadelphia market added 17.9 msf of new inventory, a decrease of 63% from the 48.4 msf in new deliveries witnessed in 2023. There was a noticeable shift in location for new deliveries, with Northampton, PA and Salem, NJ submarkets seeing the greatest amount of new product, at 2.5 msf and 2.3 msf respectively.
8.0%
Total vacancy rate has increased 160 basis points since the end of 2023
The total vacancy rate across the entire Philadelphia industrial market reached 8.0% at year end, rising 160 basis points from 6.4% measured at close of 2023, catalyzed by new deliveries and a decrease in large block absorptions. Although the delta in total vacancy rates amongst different building size groups remains, it has begun to shrink. Most notably, the delta in total vacancy between buildings 500K SF+ and buildings 50-99K SF has dropped 80 basis points since Q3 24’, now sitting at 690 basis points.
34.5 msf
Total SF Leased in 2024
Total leasing volume in 2024 measured 34.5 msf, a decrease of 14.5% from the 40.4 msf in leasing volume seen in 2023. Elevated costs of capital continued to create headwinds on growth for many occupiers. As a result, a decrease in tenant size requirements shifted the scales in demand from large to medium size format buildings. Despite this, 49.1% of the total SF leased in 2024 occurred in buildings 500K SF+. An additional 26.1% of space leased occurred in buildings 250K-499K SF respectively.
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