Industrial Leasing Activity Jumps by 12% in 2025

Executive Summary

• Accelerated leasing activity in Q4 resulted in 2025 having the second-highest annual leasing volume after 2021.
• Net absorption totaled 58.2 million sq. ft. in Q4, bringing the annual total to 149.2 million sq. ft. More than half of annual absorption occurred in H2 as many build-to-suit projects were completed.
• Strong absorption in H2 was not enough to offset new supply. The vacancy rate increased by 10 basis points (bps) to 6.7% in Q4, while the availability rate remained at 9.2% as occupiers continued to rightsize portfolios.
• Construction completions outpaced absorption for the 14th consecutive quarter but at a slower pace than prior years. Space under construction fell by 12.7% year-over-year to 220.6 million sq. ft. in Q4.
• Mega big-box facilities drove leasing momentum in Q4. Facilities over 1.2 million sq. ft. had the largest year-over-year leasing increase.