Top 5 Metros for Industrial Deliveries in 2023
In 2023, a few top metros for industrial deliveries as the sector further displayed resilience and adaptability, fueled by the reshoring and nearshoring of manufacturing, increased construction spending and the lasting impact of e-commerce. These trends signaled a strategic shift towards supply chain resilience and localization, driving continuous demand for industrial space.
On a national level, some 600 million square feet of industrial space was completed in 2023, CommercialEdge data shows. This represents a notable increase of 12.9 percent compared to the previous year, during which 531 million square feet of industrial space came online. Additionally, project completions saw a significant surge of 45 percent from the same period in 2021, when 414 million square feet was added to the inventory.
Highlighted below are the top markets for industrial deliveries in 2023, based on the total square footage added to the inventory. These five markets collectively contributed nearly 30 percent of all the new stock nationwide.
1. Dallas-Fort Worth
First on our list, the Dallas-Fort Worth market stands out as a prime location for sustainable growth and profitability in the industrial sector.
The metro consistently attracts industrial players thanks to its business-friendly environment. Legislative measures such as the Texas CHIPS Act have further bolstered this appeal, incentivizing semiconductor expansion through developer grants.
In 2023, Dallas-Fort Worth was the busiest metro for industrial construction, adding 61.7 million square feet of space, which accounted for 10.5 percent of the total stock—the highest percentage among all metros on our list. It also led in terms of the number of projects, with 175 developments completed in the past year.
Compared to 2022, completions rose by 61 percent, reaching 38.3 million square feet, and they were up 131 percent compared to 2021, when 26.7 million square feet of industrial space was delivered. Furthermore, industrial construction starts in 2023 reached 19.3 million square feet, marking a 142.5 percent increase compared to the 7.9 million square feet started in 2022.
2. Phoenix
Fueled by a burgeoning economy, an influx of residents migrating from neighboring markets and the escalating demands of the e-commerce sector, Phoenix’s industrial market remains robust. In 2023, the metro saw the addition of 32.5 million square feet of industrial space across 152 projects, accounting for 5.5 percent of the total stock.
This notable uptick represents a substantial 34.7 percent rise from the previous year’s deliveries totaling 24.1 million square feet. It also marks an impressive 130 percent surge compared to 2021, during which 14.1 million square feet of industrial space came online.
At the same time, industrial construction starts in 2023 reached 23.6 million square feet across 107 projects, representing the highest number on our list. This surge reflects a remarkable 160.9 percent growth from the same period in 2022, when 9 million square feet of industrial space broke ground.
3. Houston
Houston stands out due to its Gulf Coast location, providing direct access to crucial international trade routes facilitated by the Port of Houston. This strategic positioning not only bolsters the city’s appeal but also serves as a catalyst for the flourishing distribution and supply chain activities within one of the top metros for industrial deliveries.
In 2023, Houston witnessed the completion of 115 projects, encompassing 28.4 million square feet of industrial space, accounting for 4.8 percent of the total stock. This remarkable growth represented a notable 39.8 percent increase from the 20.3 million square feet added in 2022 and a significant 24 percent rise from the 22.9 million square feet delivered in 2021.
Data from CommercialEdge reveals that industrial construction starts in 2023 surged to 7.7 million square feet, contrasting sharply with the 119,000 square feet initiated in 2022.
4. Chicago
With a diverse economy and a sizable population, Chicago maintains a steady demand for industrial space, particularly warehouses and distribution facilities. Furthermore, the metro’s logistical advantages have grown stronger over time, attracting significant investments from major e-commerce players who have established advanced fulfillment centers in the metro to leverage its strategic positioning.
Chicago added 27.7 million square feet of industrial space across 73 properties in 2023, accounting for 4.7 percent of total stock. The amount was on par with the 27.2 million square feet added in 2022 and with the 27.4 million square feet delivered in 2021.
Industrial construction starts in 2023 amounted to 8.7 million square feet, accounting for a 201 percent increase when compared to the same time in 2022, when only 2.9 million square feet broke ground, according to CommercialEdge data.
5. Inland Empire
Despite soaring rental rates, the Inland Empire remains one of the top metros for industrial deliveries in the U.S. Its proximity to the Port of Los Angeles and the Port of Long Beach provides easy access to international trade routes, making it an ideal location for warehousing, distribution and logistics operations.
Last year, the metro added 25.6 million square feet across 104 properties to its inventory, accounting for 4.4 percent of total stock. Developers added 18.7 percent more industrial space compared to 2022, when some 21.6 million square feet was completed. Furthermore, deliveries in 2023 outpaced 2021 completions by a substantial 84.6 percent, when roughly 13.8 million square feet of industrial space came online.
An additional 5.2 million square feet of industrial space commenced construction in 2023, according to CommercialEdge. This marked a 30 percent decrease when compared to the 7.4 million square feet that broke ground during the same period in 2022.
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