Polk County Industrial CRE: 2024 Recap & 2025 Trends
As we transition into 2025, the industrial real estate market in Polk County presents a dynamic landscape for both property owners and tenants. While 2024 saw a mix of stabilization and challenges, key trends point to strategic opportunities in the year ahead.
2024 Recap: A Market Seeking Balance
Leasing Activity: A Tale of Two Halves
Leasing in Polk County was a story of highs and lows in 2024. The first half of the year recorded strong activity with over 3.2 million SF leased. However, the second half slowed significantly, with just 1.4 million SF leased. Larger deals, such as Walmart’s 815,000 SF lease, played a crucial role in absorbing available space.
Vacancy Rates & Rent Growth
Polk County’s vacancy rate stabilized at 9.2% after peaking early in the year. While new construction deliveries matched absorption, demand fluctuations prevented significant rent growth. Asking rents hovered around $9.00/SF, with older vacant properties listing lower rates.
Construction Slowdown
New industrial development slowed significantly in 2024, with just 760,000 SF under construction—a steep decline from the peak of over 4 million SF in 2022. This reduced pipeline could help tighten vacancy rates in the coming years.
2025 Trends to Watch
1. Smaller Tenant Demand Rising
Large-scale warehouse leases dominated in recent years, but the focus is shifting. Developers are adjusting plans to cater to tenants needing under 50,000 SF, a segment showing more consistent demand.
2. Rent Growth Tied to Absorption
For landlords, meaningful rent increases will depend on filling long-standing vacancies. If major leases are signed in early 2025, landlords may gain leverage to push rents higher.
3. Investment Opportunities Continue
With over $510 million in industrial sales in 2024, Polk County remains a strong target for investors. Institutional players are still active, particularly for well-leased properties with below-market rents.
4. Limited New Supply Could Tighten Market
With fewer projects under construction, the Polk County industrial market could see lower vacancy rates by late 2025. This shift may benefit landlords but could lead to fewer options for tenants looking for large move-in-ready spaces.
Final Thoughts
For both owners and tenants, 2025 will be a pivotal year. Tenants should act early to secure space before availability tightens, while landlords should focus on capturing new demand, particularly in the mid-size space market.
Stay tuned for more insights as the year unfolds. Need help navigating Polk County’s industrial real estate market? Contact us today!
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