Boston Industrial Market Report

Construction surges in response to long-term demand, infrastructure upgrades. Following three years of historically-tight operations across Greater Boston, industrial development appears to be catching up to demand. Developers this year mark the most rapid supply gain in more than 20 years, and the first time inventory growth has exceeded 1 percent per annum since 2001. While an acute rise in availability is expected, vacancy should close out 2023 comparable to immediate pre-pandemic levels. This increase will also be mitigated by a bevy of move-ins slated for this year; Amazon alone will take nearly four million square feet of distribution space off the market, equating to roughly half of this year’s scheduled deliveries. Recent infrastructure upgrades should also contribute to sustained warehouse demand. Last year, the Port of Boston inaugurated an $850 million upgrade to the Paul W. Conley Container Terminal. Among other improvements, these renovations increase the direct connections offered by this shipping node from just seven major global ports to 25, including hubs in China, Northern Europe and Southeast Asia.