Washington, D.C. Industrial Market Report Q3 2026
Pipeline Holds 12.5% of Inventory While Rents Rise
Demand
The Washington, D.C. industrial market absorbed 3.79M SF in Q3 2026, against 788K SF in the same quarter last year. Vacancy is 5.6%, 9 bps looser than Q3 2025. Rappahannock County leads rent growth at +9.5%. Trailing-12-month absorption of 11.27M SF is up from 7.33M SF a year earlier. Asking rent of $19.37/SF is up 3.6% year over year and a record.
Supply
Development activity totaled 3.55M SF in deliveries during Q3, with 14.16M SF delivered over the trailing twelve months (+48% versus the prior TTM period). Space under construction equals 12.5% of inventory, concentrated in Rt 28/Dulles North at 28.3% of its stock. Annual deliveries peaked at 12.63M SF in 2024. Q3 deliveries were 226% above last year’s 1.09M SF. The 41.79M SF pipeline equals about 15 quarters of absorption at the trailing pace.
Investment Market
Industrial investment sales across the Washington, D.C. market totaled $8.4B over the trailing twelve months, +216% against the prior TTM period; Q3 accounted for $639M. The high-water mark in this series is $7.2B in 2026.
Cap rates average 6.61%, up for 18 straight quarters. Pricing stands at $250/SF, higher for 16 consecutive years. The cap rate is 80 bps above the Q1 2022 low of 5.81%. Price per SF is at a record.
Volume
- $8.4B TTM volume (+216% YoY)
- Q3 2026: $639M
- Series peak $7.2B (2026)
Pricing
- Cap rate 6.61%
- Price per SF $250
- Caps expanding 18 quarters running
