Cleveland, OH Industrial Market Report Q2 2026

Cleveland continues to attract industrial users through its strategic location, skilled workforce, and ongoing investment. The region’s central U.S. location and extensive transportation network make it a leading hub for manufacturing, logistics, and distribution. A recent example is G&J Pepsi-Cola Bottlers’ $45.2 million expansion in the Milo-Grogan neighborhood, which added a 25,000-square-foot office building and a 77,000-square-foot warehouse with advanced automation. Employees began moving into the expanded facility in May, following Ohio tax credits awarded in 2023 that require the company to maintain operations at the site for at least nine years. A Matthews™ listing, located at 906 9th St-1164 Gibbard Ave, sits adjacent to the expanded G&J Pepsi facility and is well positioned to benefit from the area’s continued investment, increased employment, and heightened industrial activity. As industrial growth continues across Cleveland, users and investors remain focused on locations near major corporate investments with strong infrastructure and workforce access.
 

Key Findings

• Market fundamentals improved during the second quarter as net absorption turned positive, following a soft trailing 12-month stretch.
• A lean and disciplined development pipeline has kept new supply well-below national levels.
• Investor appetite held steady despite a higher cost of capital, with pricing rewarding well-located, modern distribution assets and reflecting sustained investor confidence in the market.

 

Cleveland Retail Supply & Demand Dynamics

Source: CoStar Group, Inc.

 

Cleveland Demographics

Source: Oxford Economics

• Unemployment Rate: 4.1%
• Current Population: 2,163,854
• Households: 939,022
• Median Household Income: $75,027

 

Top Cleveland Tenants by SF

Source: CoStar Group, Inc.

• B’laster Products
• HGR Industrial Surplus
• MWD Logistics
• Radix Wire & Cable

Population, Labor, and Income Growth

Annual Rates of Growth | Source: Oxford Economics

 

Cleveland Industrial Construction

Development activity continued to moderate during Q2 2026 as developers responded to a persistent shortage of shovel-ready industrial land and steadily elevated financing costs across the region. Approximately 499,000 square feet remained under construction at the end of the quarter, reflecting a pipeline well below historical norms. Higher borrowing costs and limited available sites continued to constrain new speculative starts, with developers prioritizing preleased and build-to-suit projects instead. As regional initiatives like the Northeast Ohio Mega Site work to prepare additional sites for future development, the market is expected to maintain a healthy balance between supply and demand, supporting stable fundamentals over the coming quarters.

 

SF Construction Starts

Source: CoStar Group, Inc.

 

SF Under Construction

Source: CoStar Group, Inc.

 

Sales

Dallas-Fort Worth recorded approximately $215 million in retail investment sales during Q2 2026, with average cap rates holding at 6.8%. Grocery-anchored centers, neighborhood retail, and high-quality net lease assets attracted the strongest buyer interest despite elevated financing costs. Institutional participation increased alongside continued private investor demand, reflecting confidence in the market’s durable fundamentals. Pricing remained supported by strong competition for well-located assets as buyers and sellers adjusted to the higher interest rate environment. Transaction activity continued to favor stabilized properties with durable tenant rosters and long-term income streams. Strong demographic growth is expected to support investment activity through year-end.

 

Cleveland Industrial Sales Volume

Source: CoStar Group, Inc.

 

By the Numbers

Q2 2026 | Source: CoStar Group, Inc.

• Sales Volume: $164M
• Price Per SF: $54
• Cap Rate: 10.4%
• Vacancy Rate: 4.4%
• Rent Growth: 3.5%
• Asking Rent Per SF: $6.79
• Under Construction: 499K SF
• SF Delivered: 39.4K
• SF Absorbed: 31.1K