New construction deliveries less than half of prior year’s total
Groundbreakings for new warehouse and distribution space declined as inventory delivered in prior years took longer to lease or remained unleased. Developers completed 13.2 million square feet (msf) of new construction across the I-81/78 Corridor in 2024, a 54% decrease compared to 2023. The Lehigh Valley submarket, with 2.6 msf of new inventory delivered in 2024, reported the largest decline in yearly deliveries, nearly 62%. There is 10.1 msf under construction across the I-81/78 Corridor: 5.5 msf in Northeast PA; 3.6 msf in Central PA; and just under 1.0 msf in Lehigh Valley.
Year over year, overall vacancy across the market rose 170 basis points (bps) to 7.4%, bringing vacancy closer to 2021 levels. The Central PA submarket recorded the largest year-over-year increase in vacancy—rising 230 bps to 6.9%.