12-Month Deliveries in SF:
Over the past 12 months leading up to the first quarter of 2024, the industrial market in Albuquerque experienced minimal deliveries, with a focus on build-to-suit projects. The supply pipeline has remained limited over the last decade, with only a handful of large developments coming to fruition.
12-Month Net Absorption in SF:
During the same period, Albuquerque’s industrial market witnessed strong net absorption, indicating sustained demand for industrial space. Despite limited deliveries, demand has consistently outpaced supply, resulting in a tightening of vacancies below the historical average.
Vacancy Rate:
Vacancy rates in the Albuquerque industrial market have decreased to just 3.4% in the first quarter of 2024, well below the national average of 6.2%. This trend reflects the market’s smooth and steady performance, with supply pressure being largely mitigated by strong demand.
Market Asking Rent Growth:
Rent growth in Albuquerque’s industrial market has been robust, increasing by 3.0% annually due to tight market conditions. However, this growth falls slightly short of the national benchmark of 5.2%. The market’s attractiveness has led to sustained rental rate increases, albeit at a slightly slower pace compared to national averages.
Market Overview:
Albuquerque’s industrial market is regarded as stable, with demand consistently outpacing supply. Vintage stock is concentrated along North I-25, while new developments have expanded to areas such as South I-25 and West I-40. Major tenants like FedEx Ground, Roadrunner Food Bank, and Core-Mark Holding Company have established roots in the market. Additionally, significant developments like Facebook’s data center and Amazon’s fulfillment center have bolstered economic activity in the region.
Despite challenges related to New Mexico’s nondisclosure status and limited liquidity in the investment landscape, Albuquerque’s industrial market continues to attract local and regional buyers. The market’s steady performance and strong fundamentals position it as an attractive option for industrial real estate investment.
This report provides an overview of the Albuquerque industrial market’s performance in the first quarter of 2024, highlighting key metrics such as deliveries, net absorption, vacancy rates, rent growth, and market dynamics.
