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5/26/26
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Cushman & Wakefield recently released its latest Northwest Region Industrial Report, offering an in-depth look at industrial real estate trends across major markets including Seattle, Portland, Boise, Reno, and Northern California. The report underscores a market shifting from rapid expansion into a more disciplined, opportunity-focused phase.
Since 2020, the Northwest has delivered more than 171 msf of new warehouse, distribution, and manufacturing space, driven by strong demand from e-commerce, third-party logistics providers, and a broadening set of industries including automotive, aerospace, and technology.
At the same time, the pace of new development has slowed considerably. Construction starts in 2025 declined sharply from their 2022 peak, reflecting higher vacancy levels, rising construction costs, and a more cautious development environment.
“After an unprecedented period of growth, the Northwest industrial market entered a period of recalibration,” said Wescott Owen, Research Manager at Cushman & Wakefield. “Developers are taking a more disciplined approach by prioritizing projects with clear tenant demand and long-term fundamentals, which will ultimately support a healthier and more sustainable market.”
Key Market Trends
The report identifies several major trends reshaping the industrial landscape:
• Build-to-suit development is gaining momentum, as occupiers seek tailored facilities and developers reduce speculative risk
• Speculative construction has pulled back, particularly for large-format buildings
• Mid-size facilities (100k sf–300k sf) remain the most active segment, aligning with the widest range of tenant demand
• Small-bay industrial supply remains constrained, especially in infill locations
• Manufacturing demand is rising, with sectors such as semiconductors and advanced production driving leasing activity
• The growing importance of power availability and infrastructure, particularly as demand for data centers expands, is also influencing both site selection and development strategy.
“Industrial requirements across the Northwest are becoming more specialized,” Owen added. “Power availability and infrastructure capacity are increasingly driving site selection decisions, particularly as manufacturing, semiconductor, and technology users expand alongside traditional logistics demand.”
Outlook
Looking ahead, the report anticipates more moderate construction activity in the near term, allowing the market to absorb existing inventory and stabilize. While speculative development may return selectively, future growth is expected to be more targeted and demand driven.
“The recent slowdown may prove to be an overcorrection in certain segments,” Owen said. “For developers and investors who can align product with evolving tenant needs, there will be opportunities as the market stabilizes and moves into its next phase.”
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