CHICAGO—The US industrial sector, driven in part by the extraordinary expansion of warehouse and distribution facilities, is now considered a “peaking market,” and all of the major metro areas are at least on the rise, according to JLL's analysis of the first quarter. The Chicago-based company says that means landlords are gaining leverage throughout the US, and since the sector is still in the early part of the peaking stage, the expansion should continue for some time.

“Rent growth is prevalent and speculative construction is becoming more widespread in terms of both geography and size segments,” the company states. A majority of the 51 metro areas studied had entered the peaking phase, with the rest considered to be rising markets. The strength of class A facilities has been particularly notable, with rents firmed and rising in all markets.

And the vacancy rates within the big box logistics sector has sunk so low that JLL continues “to see some spillover into demand and pricing for quality class B product.” Furthermore, “as long as the pace at which speculative deliveries are added remain controlled we expect this dynamic to increase, and—based on current tenant requirements and economic indicators—this will likely be the case for most markets in 2016.”