Thanks to the surging national demand for logistics and manufacturing facilities, Birmingham has a strong industrial market. Vacancies are still at historic lows, around 2.9 percent, allowing landlords to increase pricing. As such, rents have grown 9.5 percent in the last 12 months. Employment has essentially recovered to pre-pandemic levels since September 2021, with companies rehiring across the metro. The market benefits from Alabama’s focus on automotive supply and manufacturing, which account for nearly a fifth of the state’s GDP. FedEx and Lowe’s have announced sizeable distribution centers, and Amazon is near the delivery of an 855,000 square foot fulfillment center. Builders are active, though primarily in the form of build-to-suit spaces.
Huntsville has a diverse economy with robust technology and advanced manufacturing industries. Though Huntsville is not much of a logistics hub, it sees a lot of demand from manufacturers and firms that serve local businesses and consumers. The $2.3 billion Toyota-Mazda manufacturing plant recently opened in Huntsville, producing 4,000 jobs to the local economy and projected to produce 300,000 cars annually. The facility is anticipated to draw in additional automotive suppliers and logistics firms looking to service the plant. Leasing activity has slowed, keeping vacancies elevated at 9.7 percent. However, this hasn’t affected rent growth as the last 12 months have achieved a 9.5 percent rental increase.