— By Rebecca Lloyd of Cushman & Wakefield —
Industrial market conditions in Salt Lake City softened a bit in 2024, with new leasing activity totaling just over 5 million square feet — a 19 percent decrease from the 6.2 million square feet recorded in 2023. Despite this decline, new sublease activity saw a 33 percent year-over-year increase, reaching 735,000 square feet.
Salt Lake City’s Northwest submarket remains the dominant area, accounting for 62 percent of total leasing activity in 2024. This was followed by the Southwest at 28 percent. Collectively, they comprise 90 percent of all leasing transactions in the market.
Vacancy rates ended the year at 5.9 percent, a modest 50 basis point increase from the previous year. In a positive shift, the market closed the year with 3.7 million square feet of positive net absorption, a significant increase from the 2.3 million square feet recorded in 2023. The average asking rent for all product types stood at $0.81 per square foot on a triple-net basis, up from $0.80 at the end of 2023.
Industrial construction remained robust, with nearly 4.7 million square feet of new space delivered in 2024. This added to the 7 million square feet completed in 2023. The new product surge accounts for the recent increase in vacancy, though pre-leasing activity has helped offset some of the additional space coming online. Salt Lake City currently has 10 new industrial projects under construction, totaling 3 million square feet, with deliveries scheduled for 2025 through 2026. Vacancy rates are expected to rise in the short-term as these new developments come online. However, with limited new construction in the pipeline, overall asking rates are likely to become more competitive as vacancy levels stabilize.
Demand remains strong for outdoor storage and trailer yard spaces, particularly for smaller buildings offering one to two acres of yard area. With minimal available development land in core markets, land values are expected to stay high, prompting developers to look at outlying areas for new projects. Occupiers are increasingly focused on cost containment and improving space efficiency.
Salt Lake City continues to be a strategic hub for businesses, benefiting from strong population and job growth. The combination of a well-positioned location, affordable costs and continued demand will help sustain the region’s appeal for companies seeking space in a growing metropolitan market.
— By Rebecca Lloyd, Research Manager of Cushman & Wakefield. This article was originally published in the March 2025 issue of Western Real Estate Business.