Another Strong Quarter for Nashville's Industrial Market
Key Takeaways
- Industrial absorption exceeded positive 3.0M square feet for Q4 2022, bringing the total 2022 absorption to a record 7.6M square feet
- Market vacancy stands at 3.2%, remaining under 4% over the last 13 consecutive quarters
- Nashville development total remains elevated, with over 4.2M square feet under construction
According to data from Oxford Economics, Nashville's annual job growth rate of 5.8% exceeded the US growth of 4.1% in 2022. The market is forecasted to see job growth of 1.5% in 2023 and an average job growth rate of 0.8% in 2024 through 2027, above the forecasted US rate of 0.5%. Looking at job performance by industrial-space users, Nashville's trade, transportation, and utilities sector increased by 2.9% from December 2021 to December 2022 while manufacturing grew 1.5% in the same time frame. Nashville's industrial market had a solid Q4 performance, with move-ins exceeding 3.0M SF and leasing activity totaling 1.87M square feet. Average rental rates continue to hit new records, and vacancy has remained under 4% since 2019. The continued rise of e-commerce demand, and Nashville's geographical position of being a day's drive to half of the country's population, have kept demand for industrial space above historical norms.
