Key Takeaways:

• Pipelines continued dropping across most markets, with nationwide industrial space under construction down 25% year-over-year.

• Five of the 10 markets with the largest pipelines at the start of 2025 had less industrial space underway compared to the same time in 2024.

• Savannah, Ga., claimed the top spot for industrial development with 24.7 million square feet of space under development.

• Hyundai’s 17-million-square-foot electric vehicle plant is set to become 2025’s largest industrial project upon its full opening early this year, driving much of Savannah’s pipeline.

• Five of the largest industrial projects scheduled for completion this year are EV plants or EV battery plants. The list also includes one chip plant and one data center.

• All 10 of the largest industrial completions of 2024 were logistics facilities, eight of which were multi-building expansions in industrial parks.

In 2025, industrial development is expected to continue decelerating in response to the rapid expansion seen early in the decade. Now, the oversupply in logistics space is resulting in a tenant-favored market, and Fed rate cuts may not arrive as quickly as investors had hoped. Consequently, industrial space operators are focused on filling up tenant rosters, resulting in increasingly thinner pipelines across most U.S. industrial markets.

Still, the sector has a lot to show. For instance, with fundamentals on the upswing and a positive vacancy outlook later in the year, logistics space construction could begin to rebound. Additionally, the continued growth seen by manufacturing facilities and data centers bodes well even amid market uncertainties. Read on to discover which markets have the most industrial space under development and the largest projects set for completion in 2025.

National Industrial Pipeline Drops 25% Y-o-Y to 346.2 MSF; Savannah, Ga., Now Home to Most Development Nationwide

Across all industrial markets in the U.S., there is currently 346.2 million square feet of industrial space under construction, amounting to 1.7% of the current national stock. This figure represents a significant drop of 25% compared to the same time last year, which itself was a 33% drop compared to 2023. Record-breaking deliveries from 2021 through 2023 have resulted in an oversupply of logistics space.

Accordingly, tenants who were hard-pressed to take what space they could during the pandemic can now bide their time and choose between availabilities, with a flight to quality beginning to develop in the industry. This shift is likely to hold up for the remainder of the year, meaning that development may continue with the same sluggish pace for a while longer.

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