The demand for industrial space, confounding predictions that the advent of Artificial Intelligence would move things in a different direction, continues to grow nationally.
According to a new industry survey just released by the Yardi Matrix real estate analysis firm national rents for industrial space are currently up by around 5.4% over where they were one year ago, indicating a healthy market.
“Automation has not reduced demand for logistics real estate,” notes the Industrial National Report.
Part of the reason for that demand, continues the report, is due to “consumer expectations for faster delivery of goods, which have absorbed much of the efficiency gained from technology.”
Another factor is the nature of such industrial space itself, typically characterized by high ceilings, wider columns spacing, and open layouts able to accommodate internal products movement and robotics. Such features “often increase, rather than reduce, logistic firms’ space needs.”
Industrial space rent increases in the last year have been particularly strong in the east with Atlanta seeing an 8.1% jump over March of 2025, and Tampa recording a 7.3% increase.
The market has been strong heading out West, too, with Dallas seeing a 6.5% increase, followed by Phoenix with a 5.7% jump; and Denver, showing a 3.2% improvement over early 2025.
Meanwhile, new industrial space currently under construction appears buoyant almost everywhere, with Phoenix recording 18.8 million square feet in the building stage; followed by Denver, up by 8.3 million square feet; and Los Angeles with 4.2 million new square feet.
Despite all the new growth, adds the report, actual warehouse employment is currently on the down side, dropping by around 50,000 jobs in March. The decline has little to do with a lack of job openings but rather is driven “by a shortage of workers.”
May 4, 2026
By Garry Boulard
Photo courtesy of Pixabay
