While Portland's Industrial vacancies remain significantly below the metro's long-term average, a large influx of speculative deliveries contributes to some vacancy volatility. This trend will likely continue: Of the 1.7 million SF of speculative space now under construction, about 80% is available for lease. Speculative construction has doubtless been furthered by strong rent gains. Industrial rent growth continues to outpace Portland's office, retail, or multifamily sectors, and asking rates have increased by more than 50% in the past decade.
In 1Q2020, more industrial space was under construction across Portland than at any previous point in the past decade. Intel broke ground on a 1.5-million-SF expansion to D1X at Ronler Acres in July 2019. In 3Q2018 Amazon delivered two distribution centers to the metro, totaling almost 2 million SF. Other companies that continue to expand their presence in Portland include third-party logistics firms, retailers/wholesalers, and suppliers to the local market.
Through September 2020, Portland saw over $830 million invested in local industrial assets. Sales volume in 2Q2020 and 3Q2020 outpaced Portland retail and office investment in that time. Sales volume reached nearly $1.8 billion in 2019, likely an all-time high, and market cap rates have compressed below 6%.