The U.S. industrial real estate market saw net absorption total 29.6 million square feet in the second quarter of 2025, on par with the first quarter’s 30.3 million square feet and exceeding expectations, Cushman & Wakefield reported. Nonetheless, vacancy nationwide rose 15% year-over-year to 7.1%, the highest level since 2014.
Warehouse space completed since 2023 accounted for more than 50 million square feet of absorption in Q2, underscoring sustained interest in higher-quality buildings, Cushman & Wakefield reported. At the same time, some markets saw consolidation and downsizing continue to outweigh demand. The West region recorded negative net absorption of 2.3 million square feet, led by losses in the Inland Empire and Los Angeles.
“Large occupiers remain active, with a continued flight to quality driving demand for modern logistics space,” said Jason Price, senior director, Americas head of logistics & industrial research at Cushman & Wakefield. “While absorption is still below historical norms, second-quarter leasing activity and the strength of newer product show that the industrial sector is adapting to shifting market forces.”
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