— By Rebecca Lloyd of Cushman & Wakefield —
Salt Lake City’s industrial market ended 2025 in a transitional period defined by rising vacancy, shifting demand across product types, and heightened activity in both peripheral submarkets and the owner‑user segment.
Overall vacancy climbed to 7.9 percent, driven by more than 8.5 million square feet of new warehouse/distribution deliveries since early 2024, nearly half of which remain available. This is particularly apparent in the North West submarket, which continues to dominate the region’s industrial footprint. Despite this supply influx, tenant demand held firm with 5.9 million square feet of new leasing activity recorded in 2025. Absorption remained steady across small and mid-sized facilities, with monthly net asking rents remaining stable at $0.80 to $0.81 per square foot.
Smaller 10,000- to 100,00-square-foot buildings posted the tightest availability at 6 percent vacancy, while larger big box properties over 100,000 square feet saw vacancy rise to 15.7 percent, widening the performance gap between segments. Land scarcity, power constraints and elevated development costs continue to limit opportunities in core Salt Lake submarkets, forcing more tenants and developers to pivot toward Utah County. This is where a sizeable 4-million-square-foot proposed development pipeline is helping narrow the long-standing divide with Salt Lake County and contributing to a more regionally balanced growth pattern.
One of the most notable trends of the year has been the rise in owner‑user acquisitions, driven by small and mid-size businesses seeking long‑term cost control and functional facilities with yard space. Institutional capital has also expanded its footprint in industrial outdoor storage, frequently targeting former owner‑user sites, demonstrating growing confidence in land‑efficient, low‑coverage assets and the liquidity they bring to the market.
While the market posted three quarters of positive absorption before large blocks returned in the fourth quarter, conditions remain poised for gradual rebalancing as construction activity slows, sublease availability contracts and demand for well‑located mid‑box facilities persists.
These dynamics collectively indicate that although vacancy may stay elevated in the near term, Salt Lake City’s industrial sector is positioned for stabilization and renewed tightening through 2026 and 2027, supported by steady tenant demand, limited new supply and continued momentum in the owner‑user and industrial outdoor storage (IOS) segments that are reshaping the region’s industrial investment landscape.
— By Rebecca Lloyd, Research Manager, Cushman & Wakefield. This article was originally published in the March 2026 issue of Western Real Estate Business.