Industrial Real Estate Braces for USMCA Trade Shock Article originally posted on Globe St. on July 2, 2026 The U.S. industrial real estate sector is facing another source of supply chain uncertainty after the U.S.-Mexico-Canada Agreement missed its July 1 renewal deadline, leaving the trade pact that underpins North America’s manufacturing and logistics networks subject to annual review rather than receiving a 16-year extension. According to Yardi Matrix, the added uncertainty comes as trade policy has already weighed on decision-making for industrial tenants, investors and developers for more than a year as tariffs have played a major role. While the agreement remains in place and USMCA-compliant goods have so far been shielded from tariffs, the report said a prolonged review process could become a long-term headwind for the sector by complicating the multi-year planning cycles that drive manufacturing, logistics and industrial real estate investment. Yardi Matrix said sectors with deeply integrated cross-border supply chains, including automotive and advanced manufacturing, face the greatest exposure because components often cross international borders multiple times during production. Despite those headwinds, industrial market fundamentals have continued to normalize following several years of record development activity. National in-place industrial rents averaged $9.12 per square foot in May, up 5.2% from a year earlier. However, rent growth has moderated considerably from the rapid gains recorded during the pandemic-era industrial boom. The Inland Empire posted the nation’s strongest annual rent growth at 8.1%, but only seven of the 25 largest industrial markets exceeded that pace of growth, compared with 17 markets two years ago. Boston remained among the strongest-performing markets with 6.3% annual rent growth despite elevated vacancies, reflecting the challenges tenants face in finding modern industrial space within one of the country’s oldest inventories. Meanwhile, the national industrial vacancy rate reached 8.8% in May, up 30 basis points from a year earlier. Yardi Matrix said vacancies have begun to stabilize as the construction pipeline cools following historic levels of new supply and leasing demand returns to more typical levels. Just 383.2 million square feet of industrial space or 1.8% of existing inventory, remained under construction nationally in May, a significant slowdown from the record pipeline that reshaped the market over the past several years. Industrial leases signed during the past 12 months averaged $10.06 per square foot, only 94 cents higher than the national average for in-place rents. While tenants are no longer paying the substantial premiums for new leases seen during the market’s peak, certain markets continue to command significantly higher rents for newly signed space, including Bridgeport, Miami, Boston, Dallas and the Bay Area. One bright spot for the sector remains e-commerce demand. Online sales increased 9.8% year-over-year during the first quarter, far outpacing overall retail sales growth and pushing e-commerce’s share of core retail sales to 19.8%, just shy of its pandemic-era peak after several years of little movement.