St. Louis' industrial sector during the fourth quarter was split between weak and strong fundamentals, as highlighted in the latest market report from CBRE.
The negatives stem from pricing and vacancy. Asking rates were down 2.1 percent year-over-year to $5.48 per square foot. The lowest rents were seen in the Metro East and Downtown submarkets, which averaged just $4.36 per square foot and $4.89 per square foot, respectively. The overall decline can be attributed to the lack of speculative product being available, while older and less coveted properties dominate the availability.
Availability, while unchanged quarter-over-quarter, spiked by 140 basis points year-over-year to hit 8.2 percent.
Onto the more positive fundamentals, net absorption remained in the green territory and increased year-over-year to 193,283 square feet.
"The largest move-ins contributing to the positive quarter were Amazon occupying River Valley Logistics Center 2 in Maryland Heights (357,056 sq. ft), Thyssenkrupp Supply occupying a sublease at Gateway Tradeport 2 in the Metro East (325,994 sq. ft.) and True Fitness occupying 1 Glazer Way in St. Charles County (254,458 sq.)," CBRE said.
Leasing activity was 2.5 million square feet, as Unilever took the largest signing, with its 513,474 square foot renewal in the Metro East submarket.
When it comes to supply, 50,000 square feet was delivered in the fourth quarter, while 3.1 million square feet was under construction. Currently, just one speculative product lies in the pipeline. That's 396,534 square foot Maryland Heights Commerce Center 1.
"It is likely that in 2026 we will begin to see developer interest in speculative projects increase as the supply of existing modern bulk product dwindle," CBRE predicted.
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