Industrial Demand Surges in Texas

Net Absorption Hits New High

The Texas industrial market posted 18.6M SF of net absorption in the fourth quarter of 2025, reports Globe St following CBRE data. This is more than double the net absorption of the previous quarter and the largest gain since Q2 2023. Houston and Dallas/Fort Worth saw the most significant increases, fueling the sector’s strong performance.

Vacancy and Construction Trends

Vacancy rates dipped by 40 basis points from the previous quarter to 8.9%. This marked the first clear improvement after years of rising vacancies due to high delivery volumes. However, new construction also gained momentum, with 6.4M SF more starts in Q4, and new builds now account for 51% of all vacant industrial space in Texas. The stabilization mirrors trends seen in other property sectors, where recent absorption gains have begun to ease supply pressures and support more balanced fundamentals.

Rent Growth and Large Space Performance

CBRE reported that industrial rents across Texas climbed 1.9% year-over-year. Spaces between 400 KSF and 800 KSF led the market, seeing rent growth of 9.1%. Despite the positive momentum, overall leasing activity lagged, with signings totaling 13M SF less than 2024, and renewals remaining sluggish—just 70 deals totaling 3.2M SF in Q4.