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CBRE
I-78/I-81 industrial market sees modest rebound
Following two quarters of occupancy losses, the Pennsylvania I-78/I-81 industrial corridor saw 422,000 square feet of occupancy absorption in the third quarter of 2025.
In its latest report, CBRE said that the industrial market along the corridor continued a complex performance through 2025 as the market moved closer to peak vacancy while dealing with persistent supply and demand imbalances.
With 3.9 million square feet of new or renewed leases during the latest quarter, CBRE said nearly 12 million square feet of space has been occupied over the course of the year compared to 14.3 million during the first three quarters of 2024.
Despite some positive net absorption, overall occupancy remains below previous levels, and the market continued to display a “flight-to-quality” trend favoring Class A logistics space while demand for Class B space and lower decline across the region.
At the same time, an uptick in new construction pushed the pipeline above 10 million square feet for the first time this year.
Meanwhile, CBRE said long-term vacancies and landlord aggressiveness to pen deals has started to pose a potential threat to pricing, underscoring the challenges in the market.
Central Pennsylvania saw the highest net absorption along the corridor, beating out the Lehigh Valley and Northeastern Pennsylvania with 40% of leasing activity in that area.
