Industrial Real Estate Nears an Inflection Point as Supply Collapses

The report argues that U.S. industrial real estate may be approaching the early stages of a cyclical recovery.

• Market rents have fallen below replacement-cost rents, while construction costs remain elevated due to labor, materials and financing pressures.
• New supply has dropped sharply, which should gradually tighten the market and support a recovery in rents and asset values.
• Buildings with stronger power infrastructure and automation-ready features may benefit disproportionately as tenant requirements evolve.

If supply remains constrained while demand stabilizes, the sector could be entering a more favorable phase for rental growth and value recovery.