A Prologis facility in Tracy, CA; the REIT's shares have been upgraded by Capital One analysts. (Photo courtesy of Big-D Construction)

McLEAN, VA—Industrial REITs look generally strong going into third-quarter earnings season, which begins Thursday morning with Prologis, write Capital One Securities analysts in an industry note. That being said, the analysts note some near-term moderation of growth in fundamentals across the markets they surveyed.

Analysts Thomas J. Lesnick, Ryan Wineman and Chris Lucas surveyed the Houston, Atlanta, Southern California, Bay Area and Chicago industrial markets using data from CoStar Group and Real Capital Analytics. Broadly speaking, they write, cap rates in those markets “continued to trend flat” on a quarter-over-quarter basis, with the exception of Inland Empire and San Francisco, both of which ticked up slightly.

Metrics on pricing per square foot were mixed in the Capital One analysts' survey. “Occupancy was flat to down across most markets, except for the Bay Area,” they write. “Asking rates continued to trend higher in every market we surveyed. But asking rent growth moderated year over year in Atlanta and Inland Empire.”