Q2 2025 Nashville Industrial Market Report

 

Key Highlights

• Tenants like True Up Companies, ServeOne, Modular Power Solutions, and Dart Warehouse Corporation made moves in the second quarter by signing leases for 200,000 square feet.
• More than 80% of all industrial space added since 2020 can be found in the Wilson County or Southeast Nashville submarkets.
• Nashville’s population has grown by 6.4% from 2020 to 2024, outpacing the national level of 3%.

 

By the Numbers

• Sales Volume: $406M
• Average Sale Price Per SF: $124
• Vacancy Rate: 6.0%
• Rent Growth: 5.9%
• SF Absorbed: -770K
• SF Under Construction: 8M | Q2 2025 | Source: CoStar Group, Inc.

 

Nashville Rents

Nashville records one of the highest industrial rents in the Southeast at $12.00 per square foot. Larger properties record the least leasing activity, leading to rents around $10.50 per square foot. Meanwhile, buildings up to 100,000 square feet note the highest level of demand with rents around $14 per square foot. During the second quarter, rent growth reached 5.9%. Nashville’s rent growth is still greater than the national average level as conditions remain tight.

 

Market Asking Rent per SF

Source: CoStar Group, Inc.

Vacancy

Absorption levels have started to pick up in the metro over the past few years, but Nashville recorded a drop in absorption in the second quarter. This decline can be attributed to the recent rise in speculative development, leading to the availability rate of 8.9%. Leasing activity in Wilson County and Southeast Nashville record the greatest absorption levels. In the second quarter, one of the largest deals occurred here with Dart Warehouse Corporation signing a 225,000-square-foot lease. The leased property, Building D, is part of the Wilson Commerce Center, and was recently added in 2024.

 

Nashville Vacancy Rate

Source: CoStar Group, Inc.

 

Construction

Despite increased construction costs, new developments in Nashville are increasingly being added. As of the second quarter, 8 million square feet was under construction. Several new developments were announced, including a new industrial park for Hamilton Development in Clarksville. The facility will be made up of 200 acres, or 2.1 million square feet, across 14 buildings. Two buildings are already set to be delivered at the beginning of 2026. Until construction decreases, these increased levels will continue to impact Nashville’s fundamentals.

 

Square Feet Under Construction

Source: CoStar Group, Inc.

Sales

Investment activity in Nashville continues to climb, with $1.2 billion recorded over the past year. Institutional deals for portfolio sales drove transactions for the first half of the year. In June 2025, Stonelake Capital Partners sold three industrial buildings to institutional buyers BGO. The buildings were located in the Wilson County submarket and total 742,000 square feet. Nashville’s industrial sector is set for continued sales volume, driven by increased demand and active investors.

 

Nashville remains a top investment hub with the price per square foot doubling since 2018.

Q125 total transaction volume: $406M

 

Nashville Sales Volume & Market Sale Price per SF

Source: CoStar Group, Inc.