Is warehouse demand shifting towards inland markets?

Uncertainty has led shippers to move an increased amount of inventory across inland markets versus port markets, according to experts, but it may not necessarily translate to a shift in demand.

Demand is growing for inland markets versus port markets as shippers seek to save costs, according to some commercial real estate firms.

Cushman & Wakefield reported on Oct. 19 that demand has shifted toward inland industrial markets over the past two years while vacancy rates in port markets are 110 basis points above the U.S. average of 6.6%.

“More goods now move by truck or rail to inland distribution hubs, where labor, rents and energy costs are often lower. That shift, combined with rising import volumes from Mexico, pushed the inland share of industrial absorption to 83%, the highest level since 2010,” according to research from Cushman & Wakefield.

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