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Market Report

Philadelphia Industrial Market Report

Midyear 2023

Speculative Additions Lead to Bifurcated
Performance Between Warehouse Assets

Larger spec warehouses drive increase in available space. Philadelphia’s position in the Northeast’s urban corridor continues to shape local development trends, as the scale and position of projects in the pipeline suggests that builders are targeting long-range commercial operations. The average size of properties underway in June approached 360,000 square feet, with the vast majority of this space distributed along the Interstate 95 Corridor and New Jersey Turnpike. As a result, vacancy in larger distribution assets could remain elevated in the near term. Of the metro’s 16 industrial properties exceeding half a million square feet under construction, 11 reported no leasing commitments as of the end of June. Still, the market’s position in greater supply chains, as well as the Port of Philadelphia’s recent connections to East Asian markets, present a solid foundation for demand from larger logistics operators moving forward. 

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