Q3 2024 Philadelphia Industrial Market Report

Over the past year, 19.5 million square feet were leased in Philadelphia’s industrial market, highlighting steady demand that aligns with pre-pandemic trends. Growth is fueled by robust new development and leasing activity for the region’s most advanced logistics, automation, manufacturing, and distribution facilities. Since 2022, the industrial market in Philadelphia has seen rising vacancies, driven by a high level of construction deliveries. This is expected to taper off by 2025, however, the increase in available space is forecast to continue in the interim. Despite supply-induced vacancy, leasing demand remains solid, although significant leases over 500,000 square feet have slowed in the past year. The Federal Reserve’s recent half-point interest rate cut is expected to unlock liquidity in industrial commercial real estate financing, potentially spurring transactions and development opportunities.

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