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Market Report

Philadelphia Industrial Market Report

2023 Investment Forecast

Philadelphia Benefits from East Coast Shipping Surge;
Logistics Hotspots Retain Buyer Interest

Metro well-poised to withstand continued supply wave. By the end of 2023, more than 36 million square feet of industrial space will have been delivered over the trailing three-year period, though foundational demand factors will keep vacancy well below the long-term average of 7.3 percent. Upgrades to the Port of Philadelphia’s berthing capacity came online as supply chain hurdles diverted much of the nation’s cargo throughput to the Eastern Seaboard. Last year, the port celebrated its first shipping route to China and Southeast Asia, the result of a $330 million project initiated in 2016. Another $246 million committed last year has already prompted private terminal operators to upgrade and support distribution demand farther out. Philadelphia warehouses could also benefit from the increasing prominence of the Port of New York/New Jersey, which briefly overtook the Southern California ports as the nation’s busiest maritime hub in 2022. Within a two-hour drive of the former node, the Philadelphia metro is an important link in the distribution of goods across the entire Boston-Washington, D.C. urban corridor.
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