The need for modernization of industrial assets will continue to climb this year and beyond as digitalization, demographics and deglobalization drive the booming sector to new heights, a team of Newmark researchers say.

They note that more than 70% of US industrial space was built before the 21 century, while a full third of the inventory is over 50 years old. And "the current construction pipeline measures 500 million sq. ft., nearly all set to deliver by 2023, signaling a potential future supply gap if speculative construction starts remain muted in 2022 due to prolonged disruption," they predict. That's especially true as net absorption nearly totaled that same amount in 2021 alone.

Pathways to achieving that modernization could involve prioritizing last-mile inventory additions in high-population growth areas.  The Newmark analysts note that in a recent study, 99% of 500+ retailers surveyed shared that they will offer same-day delivery by 2025 (35% offer it today).