Twenty-foot equivalent unit (TEU) volumes at major North American ports increased through the first seven months of this year, compared to modest totals through most of last year, due to higher import totals. Cushman & Wakefield attributed this trend to the resilience of the U.S. economy, despite relatively flat inflation-adjusted retail sales.
The International Longshoremen’s Association’s strike, which lasted just a few days, also increased shipping volumes as shippers rushed to get goods into the country ahead of the September 30 contract deadline.
“While import volumes increased slightly across major U.S. ports, this has not impacted their respective warehousing markets, many of which have had limited or negative net absorption since early 2024.” Price said. “However, some markets near ports continued to see healthy demand.”
The healthiest absorption totals through the first half of 2024 were in Houston (9.9 million square feet), Savannah (7.3 million square feet), and the Inland Empire (2.8 million square feet). These markets were supported by new construction deliveries with tenants. However, construction totals were more modest in many port markets. New construction deliveries accounted for less than 4% of inventory in Los Angeles, Oakland/East Bay, New Jersey, and Seattle.
Nationwide, 856.6 million square feet of new supply was added from 2023 to mid-2024. Developers are focusing on Class A supply amid the cooling trend, the report said. During this period, deliveries accounted for 4.9% of total U.S. inventories, but the pipeline was significantly evaporated, down 46% year-over-year.
Industrial rent growth is slowing across the port market, with most West Coast ports reporting significant year-over-year declines due to lower demand and increased vacancies, according to Cushman & Wakefield. has been done.
