Q2 2025 Cleveland Industrial Market Report

Key Findings

• Cleveland recorded an increase of 5,600 residents in 2024, which is the second consecutive year of population growth.
• Medina County and the Strongsville submarkets recorded an uptick in leasing activity, up 50%annually in the first half of 2025.
• Construction is at its highest level in two years with 2 million square feet underway.
• Due to the lack of vacant land, recent deliveries are made up of repurposed shopping centers and older manufacturing facilities.

 

By the Numbers

• Sales Volume: $106M
• Average Sale Price Per SF: $50
• Cap Rate: 10.5%
• Vacancy Rate: 4.2%
• Rent Growth: 3.4%
• Average Market Asking Rent Per SF: $6.62
• SF Under Construction: 2M
• SF Delivered: 10K | Q2 2025 | Source: CoStar Group, Inc.

 

Cleveland Market Performance

Cleveland’s industrial sector noted negative absorption levels for the first half of 2025, with -984,000 square feet absorbed in the second quarter. The drop in activity can be attributed to increased move-outs, as well as low availability. Cleveland’s availability rate has been around 5% for the past two years, far below the national rate of 9.6%. Due to the low availability, renewals accounted for the most absorption activity in recent quarters.

 

As Cleveland’s fundamentals remain tight, rents grew by 2.4% over the past 12 months. At the end of the second quarter, the market’s average asking rent was $6.62 per square foot. Newest additions across Cleveland note the highest rents around $7.50 to $8.00 per square foot. Lower rents are most often found in older properties in northern suburbs. For example, Champion Moving recently leased 41,300 square feet in the Wickliffe/Willowick submarket at $4.50 per square foot.

 

Cleveland Industrial Supply and Demand Dynamics

Source: CoStar Group, Inc.

 

Construction Activity

While Cleveland recorded slow construction levels in the past few years, construction ramped up in the second quarter with a total 2 million square feet on the way. The largest facility under construction will deliver in the Geauga County submarket in October 2025. It is made up of 747,000 square feet, and will be the submarket’s greatest addition over the past 25 years.

 

Cleveland Industrial SF Under Construction

Source: CoStar Group, Inc.

 

 

Sales Update

Sales remain greater than pre-pandemic levels, with deals 23% above the level from 2015 to 2019. Private investors account for the most deals over the past 12 months, making up 60% of these sales. Transaction levels increased in the second quarter, recording a total $106 million in deals.

 

Cleveland Industrial Sales Volume & Price per SF

Source: CoStar Group, Inc.