Rents Plateaud; Deals Ahead

CompStak’s 2025 biannual review shows the CompStak Industrial Rent Index slid 4.7% from its late‑2023 peak, marking three consecutive quarters of softening across major U.S. industrial markets. (compstak.com) About one‑third of U.S. markets recorded asking rents down 5% or more in 2025, and analysts say rising incentives have pushed effective rents lower than headline asking rates. (savills.com) Concessions expanded materially in 2025: free‑rent periods reached 4.3% of term on bulk leases and 3.2% on small‑bay deals, while annual escalations trended lower for short‑term contracts. (compstak.com) In the Inland Empire, availability climbed to a 14‑year high of 11.7% as 4.3M SF of new supply pushed vacancy to 7.6% and left roughly 50M SF vacant region‑wide by year‑end. (colliers.com) Landlords are structuring deals to accelerate renewals and absorption: occupiers signed renewals an average of 219 days before expiration in 2025, prompting owners to offer larger tenant‑improvement allowances and longer free‑rent windows to lock in tenants early. (cbre.com) Capital shifts are influencing concessions — private equity doubled its share of small‑bay purchases to 63.3% in 2025, increasing the pool of owners who favor flexible, shorter‑term cash‑flow strategies that often translate to structured concessions. (compstak.com) Major broker forecasts expect leasing to tick up in 2026 as renewals rise: CBRE projects a 5% year‑over‑year increase in industrial leasing with renewals accounting for more than 35% of volume, underscoring why owners are trading headline rate pushes for tailored deal mechanics. (cbre.com) Leasing momentum in H2 2025 produced stronger absorption totals (Q4 net absorption was the best quarterly figure since Q2 2023), signalling landlords will increasingly use structured concessions — TI packages, staged escalations, and longer abatement schedules — to convert that momentum into signed deals in early 2026. (jll.com)