Phoenix ranks second in US for industrial space under construction, trailing only Dallas

Article originally posted on Phoenix Business Journal on April 30, 2025

The Phoenix metro continues to be a hot spot for industrial space demand, ranking second across all U.S. cities for square footage under construction in its pipeline, according to a new report from Yardi Matrix.

As of March, Phoenix had 15.1 million square feet of industrial space under construction, beaten only by Dallas, which had a whopping 24.8 million square feet. Houston followed Phoenix, with 14.7 million square feet.

Year-to-date, Phoenix also had $449 million in industrial sales, ranking fourth across all U.S. cities.

The news comes as Phoenix’s industrial boom is actually slowing, following years of record-setting growth coming out of the pandemic. In 2022, the city had a whopping 39.8 million square feet of warehouse and distribution starts.

While warehousing, logistics and manufacturing have largely driven Phoenix’s recent boom, space needs appear to be shifting. For the first quarter of this year, data centers accounted for 5.8 million square feet of Phoenix’s roughly 15 million square feet under construction.

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