The industrial sector led the way in investment sales, contributing $22.8 billion in the fourth quarter, a 31% increase from the prior quarter. Looking ahead to 2025, investors are expected to continue favoring industrial and e-commerce assets.
The Yardi-owned company forecasts that a significant rise in new construction in 2025 is unlikely and that the focus in the industrial sector will largely be on developing data centers and manufacturing facilities, as demand for these spaces persists.
Trade tariffs may lead to inflation and recession, as seen in the past, with profound effects on the construction sector, impacting both costs and demand. And immigration policies that induce fear among workers could worsen the ongoing labor shortages in construction, making it harder to recruit and retain skilled labor.
During his first week back in office, Trump confirmed that February 1 was the target date for implementing a 10% tariff on imports from China and a 25% tariff on goods from Canada and Mexico.
From an investor’s perspective, small bay properties have notable advantages. They attract a wide variety of tenants, typically on short leases of three to five years, allowing landlords the flexibility to adjust rents frequently and providing some inflation protection.