Reichle Klein Group’s 2024 Year-End Industrial Market Overview

The Toledo, Ohio area industrial space market remains the strongest property type segment based on Reichle Klein Group’s year-end 2024 survey. The headline number is 3,794,267 square feet of positive net absorption resulting from the delivery of 2,409,399 square feet of built-to-suit space and First Solar occupying the former Peloton facility in Troy, Township. In the 30 plus year history of our survey this is, by far, the record high for positive net absorption in a six-month period and eclipsed the next highest recorded amount by 1,242,842 square feet. Truly remarkable for a local market of 97.5 million square feet.

Given the level of absorption, it is no surprise that the overall market vacancy rate declined in the second half of 2024 to 2.25% from 3.71% at mid-year. It is also no surprise that the amount of space under construction fell dramatically from mid-year. There was 740,000 square feet of space under construction at the end of 2024, all of which is being built to suit. Spec construction remained at a standstill in the last six months of the year. Meanwhile, the average asking rental rate increased from mid-year to stand at $5.72 per square foot in December of 2024.

Though it doesn’t show up in the numbers, perhaps masked by the incredible level of absorption noted above, our industrial specialists feel like more space has come to market in the latter half of the year. Regardless, smaller buildings/spaces in the 10,000 to 70,000 square foot range are in short supply relative to demand.

User activity was slower throughout the year, though there was a notable increase immediately following the November 2024 election. As the list of top transactions on page five of this report demonstrates, automotive users were not among the active industry segments. First Solar has been the big market driver for several years, though having taken occupancy of two new facilities in 2024 they may have done all that they are going to do in the Toledo market. With a six hundred thousand square foot build-to-suit facility under construction, Amazon is growing its footprint in the market. The market also landed its second new data center project in the second half of 2024.