Skip to main content Skip to footer

2022 Q2 Industrial Market Report

Download Report

Pittsburgh has gained a reputation for stability, and it continues to be evident in its Industrial market within Q2, 2022. A lack of vacant supply and the growing e-commerce sector have protected the market from volatility, as we continue to see leasing and sales activity. In Q2 2022 the market experienced net absorption of 247k SF, with 1.6M SF of absorption projected for the remainder of 2022.   1.9M SF of primarily high bay distribution product is currently under construction, with approximately 1.4M SF of space to be completed in 2022. With this level of speculative construction, constraints on supply should be less of a concern in the next several quarters.  While there appears to be relief in sight on the supply side, employers, and particularly manufacturers, continue to experience employment shortages. 

The second phase of the Southern Beltway (I-576) opened during the second quarter, granting accessibility from the Greater Pittsburgh International Airport directly to I-79 South.  The first phase of the beltway was the impetus for significant development, and it is anticipated that the Phase 2 completion will serve as a catalyst for further development. While no major projects were completed in the Parkway West Corridor in Q2, the recent completion by Neyer of South Campus Dr - Building 300, alongside the projected Q3 completion of 251 Solar Dr. – Building 1 will add 276,702 SF to the submarket. 

Further support of the region’s stability is demonstrated by the fact that, in Q2, Pittsburgh’s industrial market outpaced the National Index for industrial rent growth. Over the last 12 months, Pittsburgh’s Industrial market has seen a dramatic 11.4% increase in annual rent. This was the largest Annual rent growth that Pittsburgh has experienced, only below the national all-time high by 0.6%.
Rent hikes can be partially attributable to the lack of vacant space. This is very submarket driven, as there is currently a delta when it comes to submarket vacancy rates. On one end we have the Parkway East Corridor, a submarket with a 12.2% vacancy rate. Contrast that with the Parkway West submarket at 7.5% vacancy. This speaks to the old real estate adage of Location, Location, Location, because not all the region’s submarkets are created equal when it comes to demand from users and developers. All-in-all, in Q2, Pittsburgh’s industrial market is seeing an average vacancy rate of 4.8%.  For perspective, this is only 10 basis points higher than the national average vacancy rate of 4.7%.
With these low levels of vacancy, the region has not experienced a decrease in leasing or sales activity.  In Q2, the average market rent of Industrial property across all of Pittsburgh was $7.05, with an average availability rate of 6.7%. Some of the most notable leases in the 2nd quarter have been; Black Box Corp.’s lease of 273k SF of space at 1000A Park Dr. in the Washington County submarket which was a sale with a subsequent leaseback;  and Berlin Packaging’s lease of 157k SF of space at 2400 Sweeney Dr. in the West Pittsburgh submarket, which was an expansion onto the space they currently occupy in the neighboring building, and Warners lease of 50k SF of space at 108 Tomlinson Dr. in the Butler County submarket.
Sale volume was highest, not surprisingly, in the Parkway West Corridor, where there has been $100M in sales volume over the last 12 months. SF price was also highest in the Parkway West Corridor, coming in at an average of $108 psf. The largest sales in Q2 consisted of 1000A Park Dr., a 274k SF property in the Washington County submarket which fetched a price of $24.8M ($91/SF), 256 S Campus Dr - Building 200, a 74k SF property  in the Parkway West Corridor which sold for $12.6M ($170/SF), and 10 S Campus Dr - Building 100, a 74k SF in the Parkway West Corridor with a sale price of $11.4M ($154/SF). 

230k SF of Industrial space has been completed within the region in 2022 to date. That is 16.4% of the 1.4M SF that is scheduled to be completed in 2022. Most of the Industrial construction is happening in the Parkway West Corridor, which remains the most favored submarket in the region. 1.08M SF is currently under construction in this submarket, with 400k SF under construction in the Beaver County submarket, 279k SF in the Westmoreland County submarket, and 71k SF in the West Pittsburgh submarket. It is clear to see just how much activity is happening in the Parkway West Corridor by this metric alone. If you were to take the top 4 submarkets when it comes to total SF of Industrial space being constructed, the Parkway West Corridor would have more than the other 3 submarkets combined. Not only is the submarket developing more space, but it is being absorbed at a faster pace. Both the Beaver County and West Pittsburgh submarkets have seen 0% of their new construction secure a pre-lease. 14.8% of construction in the Parkway West Corridor has already been pre-leased, constituting over 50% of the total pre-leasing of new Industrial construction in Pittsburgh. 
Although construction volume seems promising, the job recovery since pre-pandemic remains a concern. Pittsburgh is down 64,000 jobs when compared to pre-pandemic levels, while nationally, jobs have returned to normal levels. Manufacturing employment in Pittsburgh is still approximately 10% below pre-pandemic levels of employment. This contrasts with the fact that we have broken a decade long trend of population decline within the Pittsburgh region. Allegheny County’s population saw a growth of around 2.2% between 2010 and 2020. 

To summarize the Industrial market in Pittsburgh as a whole: it is stable and continuing to grow.   Population trends show growth over the coming years, and with 2.85M SF of construction, and historically low vacancy rates, we anticipate enough jobs to make a sustainable recovery that exceeds pre-pandemic levels in the coming years.


2022 Q2 Industrial Market Report

Download Report
Related Experts

John Bilyak

Managing Director/Market Leader


I am a Principal at Colliers International | Pittsburgh and I am the team leader for the industrial team.  I have been involved in the commercial real estate business for more than 21 years, with a focus on developing client relations, executing industrial brokerage assignments, site selection and real estate related consulting and market valuations.  Prior to joining Colliers International | Pittsburgh, I spent more than five years with NAI Pittsburgh Commercial, the Westen Pennsylvania regional representative of NAI Global, and 13 years with the Grubb & Ellis Company as Vice President of Industrial Brokerage.  I worked extensively with prominent local and national real estate users, investors and developers such as CBS Corporation, Matthews International, McKnight Capital Group,  Sampson Morris Group, Walnut Capital, The Buncher Company and Pittsburgh Industrial Parks.

View expert

Raymond Orowetz

Senior Vice President | Industrial Brokerage


Educated as a civil engineer (read frustrated architect) I learned the hard way that, no matter how devoted, energetic and productive an employee you might be, you're expendable.  So, after getting my pink slip as my thank you for spending 12 years in the engineering world, I could feel a change in the air.

The last few years of my engineering career were spent in business development and the sales side of engineering. I had gotten the sales bug. Having invested in some multi-family real estate I decided that commercial real estate would be my next challenge and a great way to harness the entrepreneurial independence of the real estate world with the excitement of unlimited income.

I knew absolutely no one in the business so it took a while to get traction and a position in the big leagues. After 6 or 7 years I figured I knew everything and everyone so I set up my own brokerage firm. What was I thinking? Flying solo required a 110% commitment in order to provide a high level of service to my clients while establishing a reputable business. But I did exactly that and I ran it for 15 years.

The timing was perfect, however, in 2005 to join NAI Pittsburgh Commercial as it was being formed. The NAI platform provided an ideal springboard for me to continue to grow my book of business minus the day to day issues of being an owner. In July of 2011 we changed platforms and became a member of Colliers International.

Being a registered professional engineer, in addition to a real estate broker, has opened many doors. I bring a different perspective to the table along with a true understanding of the principles behind building design, construction and development.  I offer my clients a unique combination of knowledge, skills and experience.

View expert

Cody Hunt



I am an Associate at Colliers | Pittsburgh specializing in Industrial and Investment properties.  My responsibilities include developing client relations, executing brokerage assignments, consulting, and market valuations. I started my sales career at ADP in small business development. I completed their sales training, which was an unmatched, in-person program that allowed for rapid development of basic sales skills. At the same time, I purchased a distressed residential property and worked to educate myself on how to rehabilitate the property from the ground up. My experience in real estate ignited a drive in me to learn as much as I can about the industry. With my interest in real estate, and experience in business-to-business sales, brokerage was the clear path for me to take with my career. I am passionate about what I do, and highly value the clients that I work to serve.

View expert