Demand for industrial space in Nashville is surging and exceeding the amount of supply in the market, according to a report from CBRE. During the fourth quarter, net absorption came in at 778,940 square feet, a 71.5 percent increase from the previous three months. In comparison, deliveries in the fourth quarter were only 672,000 square feet.
"Four of the five largest absorptions occurred in properties built since 2015, reflecting occupiers' focus on securing top-quality availabilities suited for new operations and efficiency needs," CBRE said.
"Tenant preference for modern facilities continues to shape absorption trends and is expected to remain a key driver as additional Class A space is delivered in 2026, particularly in emerging logistics submarkets.
Leasing volume in total was about 2.11 million square feet, with most of the activity coming from new deals rather than renewals. Quanta Corp. signed the largest lease in the quarter, snagging 564,300 square feet of space in the Interchange City submarket. J.J. Kane Associates and Sims Recycling Solutions were the next two largest, securing 283,140 and 200,000 square feet spaces.
The strong demand was enough to keep the vacancy rate stable at 4.2 percent, according to CBRE. This marks a six basis point drop from the third quarter. The CRE firm added that vacancy remains low despite over 3.4 million square feet of space under construction, underscoring "Nashville's position as a constrained and resilient industrial mark."
Asking direct rents also showed impressive strength, increasing by 6.2 percent to $10.30 per square foot, setting a new pricing record in the market. This was thanks to the resilience of Class A assets, a category where landlords are finding themselves offering limited concessions.
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