Richmond Industrial Market Figures Q4 2022

The Richmond industrial and logistics market shattered previously held records for market fundamentals in the final quarter of 2022. As developer interest and tenant demand remained strong, annual industrial completions and positive net absorption cruised to all-time highs while vacancy dipped to all-time lows.

A total 4.0 million sq. ft. of warehouse product delivered across the market in Q4—65% of which was preleased, bringing total completions for 2022 to 7.5 million sq. ft and more than doubling the previous completion record from 2012. As a result, Richmond recorded 2.6 million sq. ft of positive occupancy gain in Q4—the eleventh consecutive quarter of positive absorption—and ended with 7.9 million sq. ft. of positive absorption for the full year, a 123% increase over the previous record from 2005.

Meanwhile, 1.1 million sq. ft. of speculative product delivered at Raith Capital’s project at Hickory Hill Road. As a result, vacancy rates rose to 3.5% in Q4, a 170 basis points (bps) decline year over year, but a 110-bps uptick quarter over quarter. Another 3.8 million sq. ft. remains underway after a new quarterly record for deliveries. Of note, Flint Development Group recently announced the sale of its 1.2 million sq. ft. Caroline Logistics Project at 0 Carmel Church Loop to Worldwide Distribution Inc.—an owner-user set to close on the deal and occupy the distribution space upon its completion in Q2 2023.