LOS ANGELES—The numbers go a long way toward telling the story of industrial for 2014. In the fourth quarter alone, nationwide positive absorption reached 66.1 million square feet, or nearly twice the pace of new supply coming on line, while the supply/demand imbalance helped push rents up 4.8% during the year. CBRE, which says investment sales in the sector this year could match the 2007 peak, also predicts more rent growth: 5.0% this year and 4.9% in 2016.

Already in Q4 of the year just past, the $16.1 billion in sales volume was the third highest quarterly total in the past 14 years. If industrial investment—which totaled $54 billion in '14—continues growing at the pace set last year, the 2015 volume will reach the prior peak of $61 billion, set in '07.

Nearly matching that prior peak was pricing on a per-square-foot basis. The prior year ended with an average of $72 per square foot, just $3 per foot under the previous high watermark of $75 per square foot, established in Q3 '07.

“The US industrial market is firing on all cylinders,” says Jeannette Rice, Americas head investment research at CBRE. “The low cost of energy and a strong dollar are contributing towards increased business investment, production, employment and consumer consumption. These diverse sources of growth have combined with local economic factors to generate demand for industrial space not seen since before the financial crisis.”

Looking ahead, CBRE notes that the development pipeline is quite full at more than 140 million square feet. “Construction has hit a high point for the recovery and we expect to see it go even higher; however, we don't anticipate a return to prerecession levels,” according to a CBRE report. Over the next few quarters, rent growth will be the critical driver for speculative projects coming out of the ground “at the scale we would expect at this point in the cycle.”

Up until now, growth in e-commerce and the “shifting global logistics landscape” have driven the recovery in the sector and big-box distribution centers have been the focal point of new construction. However, CBRE notes that fundamentals in the light-industrial segment—that is, properties of 100,000 square feet or smaller—have improved, with rents rising significantly in some markets.

“This segment of the market is likely to return to the limelight in the coming quarters as the economy continues to improve,” according to CBRE. “Investors would be wise to investigate opportunities in this part of the market.”

Long term, the report says, “conditions are ripe” for industrial fundamentals to stay healthy. “Economic trends will continue to support demand for industrial space: imports are bound to increase, due in part to a stronger US dollar, and inventory levels will continue to grow as business and consumer confidence improves. Energy-intensive manufacturing production and consumer spending on goods will both benefit from lower petroleum prices in the near term.” In the medium to long term, CBRE foresees “structural changes towards omni-channel retail and e-commerce, and efficiency gains” as key factors.

Even CMBS delinquency data affirm industrial's winning trend. The sector's 30-day 6.5% late-pay rate was the highest among the major property types as '14 ended, but year-end data also showed that industrial posted the largest year-over-year decline in CMBS delinquency.