TAKEAWAYS
- Vacancy has steadily increased since Q2 2022; however, it is 50 basis points (bps) below the five-year average of 5.3%.
- The construction pipeline will face headwinds from rising interest rates and economic uncertainty that could see projects taking more time to break ground.
- There has been no downward pressure on asking rents for warehouse/distribution space; while activity may slow, the cost of construction will prevent landlords from offering significant rent discounts.