As the Delta variant surge further exacerbates global supply chain constraints, the industrial and logistics real estate market is expected to see secondhand benefits driven by skyrocketing transportation costs. The positive momentum seen in the first half of the year continued through Q3 2021, with leasing activity expected to remain high as the holiday season approaches. The Baltimore market posted 3.2 million sq. ft. of positive net absorption during the quarter, marking the second highest quarterly occupancy gain since Q3 2019. Vacancy dropped 100 basis points (bps) over the quarter to 4.8%, the lowest ever recorded in the market.

Gross leasing volume doubled over the prior quarter to end Q3 at 4.1 million sq. ft., exceeding the 2020 quarterly average by 1 million sq. ft. Demand for Class A warehouse space is outpacing supply in every submarket, with developers and investors expediting projects wherever possible. Warehouse vacancy dropped 90 bps over the quarter to a record low of 4.0%, with only two available spaces above 500,000 sq. ft. in size. Competitive land prices combined with exceptional logistic capabilities have turned Baltimore into one of the fastest growing markets in the nation for rent growth, and because of this, CBRE Econometric Advisors has projected Baltimore to have the second-fastest rent growth rate among all U.S. markets.