Greater Boston’s industrial market closed out 2022 with consistently strong fundamentals despite facing significant macroeconomic headwinds. Leasing activity rallied from its third quarter deficit and ended the year with 1.7 million square feet of positive net absorption. Landlords remained bullish on rents, as the overall average asking rate realized a 12.3% uptick over the year. Several properties that experienced extended construction timelines delivered in the fourth quarter of 2022, providing much-needed supply to an otherwise tight market. The spike in deliveries caused overall vacancies to stabilize above 3.0% as well as quoted rents for the Class A Warehouse/Distribution subtype to decline. Demand continues to outpace supply for quality industrial product, which bodes well for the long-term health of the market. Capital markets felt the impact of interest rate volatility and investor uncertainty during the fourth quarter of 2022, as the average per-square-foot sales price dipped below $200/SF for the first time since the third quarter of 2021.
Read more