The market has also seen a dynamic shift in the size of tenants, which is fueling growth.

“What used to be a small to mid-size tenant market has now become the home for multiple large-scale distribution and manufacturing users; for example Amazon.com, Maruchan, Caterpillar and Dollar General,” Burlingame says. “This should fuel an exciting growth trend and lead the industrial market in the San Antonio MSA into its next stage of maturity.”

The growth and maturing of the market is likely to continue for some time.

“Given the amount of demand and velocity we are seeing in the market, I expect these favorable market conditions to continue for the next couple of years as companies are now seeing San Antonio as a strategic location for regional distribution,” Aguilar says. “In addition, the activity we are seeing on a pre-lease basis proves there is still a lot of active demand that should continue into the foreseeable future.”

Average asking rental rates rose to $6.33 in the second quarter, a $0.34 jump from the first quarter. The increase is the first time the city has see asking rates over $6.00 since 2011.

In the year ahead, Burlingame says he expects “the market to stabilize in terms of vacancy and rental rates. Developers are starting to build and deliver product to meet the current and expected demand. This should help lower the vacancy compression and will offer excellent space to users at reasonable rental rates.”