The U.S. industrial real estate market staged one of the most dramatic booms in modern commercial real estate history between 2020 and 2022, driven by the pandemic-era surge in e-commerce demand, supply chain restructuring and speculative development.
Nowhere was this more visible than across six high-growth Sun Belt markets: Atlanta; Austin, Texas; Houston; Nashville, Tenn.; Phoenix; and San Bernardino/Riverside, Calif., which collectively attracted a disproportionate share of new industrial development.
The divergence between the Sun Belt six and the broader market is stark. Across the 41 non-Sun Belt industrial CRE markets in this analysis, average industrial vacancy stood at 7.2% in the first quarter of 2026. By contrast, the Sun Belt s...