Industrial had been one of the two major darlings during the high points of the pandemic, along with multifamily. Now financing for multifamily is ebbing. As for industrial, bulk space demand hit a steep drop, according to Colliers, as higher interest rates and ongoing inflation twist the arm of the economy.
Total demand for bulk industrial space — that for tenants who need at least 100,000 square feet — dropped 47% in Q1. Not year-over-year, but quarter-over-quarter, representing a sudden jam on the brakes.
Not that the subsector has had a complete collapse. Far from it. Demand was still "slightly above 93.6 million square feet." That is nearly the figure from 2021's Q1.
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