Key INDUSTRIAL Takeaways For Q4 2024

• Net absorption totaled 36.8 million square feet (msf) in the fourth quarter, up 10.5% quarter-over-quarter (QOQ). For 2024, 135 msf of industrial space was absorbed, on par with Cushman & Wakefield forecasts. 

• Construction deliveries decelerated for the second consecutive quarter, with 85.3 msf of new supply added in the fourth quarter—the softest quarter for deliveries since the second quarter of 2021. Over 425 msf of industrial facilities were completed in 2024, 78% of which were speculative, driving vacancy rates higher in many markets. 
  

• The overall vacancy rate ticked up by 20 basis points (bps) in the fourth quarter to 6.7%. This was the smallest quarterly increase since the market cooldown began in late 2022—a sign that the market may approach peak vacancy soon. 

Key MULTIFAMILY Takeaways For Q4 2024

• 2024 was a banner year for multifamily absorption. More than 436,000 units were absorbed—a 72% increase over 2023 and 56% above the 2017-2019 average. Every one of the 90 markets tracked by Cushman & Wakefield Research posted more net move-ins than move outs, with the Sun Belt continuing to lead in growth.

• A record number of new apartments opened in 2024, pushing vacancies up by 40 basis points (bps) despite strong demand. The national vacancy rate climbed to 8.9% in the fourth quarter—the highest level since record-keeping began in 2000—driven by the delivery of more than 530,000 new units throughout the year.

• However, construction risk is quickly diminishing. Construction activity has fallen 40% from its peak, with new starts down to just 230,000—the lowest level since 2012. High interest rates, weaker effective rent growth, and rising replacement costs continue to hinder new development. Most apartments slated for delivery by 2028 have already broken ground, setting the stage for a tighter supply environment over the next three to four years.

Key RETAIL Takeaways For Q4 2024

• A strong finish. The fourth quarter registered the strongest net absorption of 2024 with a total of 1.4 million square feet (msf), and the shopping center vacancy rate held steady at 5.4%. The fourth quarter accounted for 89% of the annual net absorption total, signaling that the retail market is in a healthy spot heading into 2025. 
  

• Facing supply-side woes. Retail construction continues to be historically subdued, as a record low 8.3 msf of new shopping center space was delivered in 2024. Only 10.6 msf is in the construction pipeline as of the fourth quarter, so inventory growth will continue to be sluggish for the next few years.
  

• Striking a balance. While the South and West regions had been the primary growth regions immediately following the pandemic, both experienced negative demand in 2024. The Northeast and the Midwest have led the way more recently; in 2024, they saw positive net absorption of 720,000 sf and 1.5 msf, respectively. Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Amet aliquam id diam maecenas ultricies mi eget mauris.

Despite many uncertainties, the U.S. economy is poised for growth in 2025, driven by consumer spending, easing financial conditions and productivity gains. While retail and data centers have been supported by longer-term trends, all other real estate sectors will see the start of a new cycle.