Vancouver and Seattle Industrial Trends Offer a Warning for Boise Developers

Industrial real estate can shift quickly. One year, warehouse space feels almost impossible to find. A few large projects later, tenants may suddenly have more choices and landlords may face greater competition.

That contrast is now playing out across two major Pacific Northwest markets. According to analysis by Elliott Krivenko and Paul Richter for CoStar Analytics, Vancouver’s industrial market is tightening while Seattle continues to work through a large amount of recently constructed logistics space.

Although Boise operates on a smaller scale, the lesson is highly relevant to Boise commercial real estate: demand matters, but the timing and volume of new construction can change a market just as much.

Two Industrial Markets Moving in Opposite Directions

Seattle entered the third quarter of 2026 with an overall industrial availability rate of 12.3%. Its logistics sector had about 40 million square feet being marketed as available, representing roughly 15% of that segment.

Occupancy also moved in the wrong direction. Seattle recorded approximately 2.1 million square feet of negative industrial absorption during the previous year. Logistics properties accounted for most of that loss.

Vancouver produced almost the exact opposite result. Its industrial market absorbed about 2.1 million square feet during the same period, with warehouse and distribution companies driving most of the demand.

Large tenants also behaved differently in each market. Seattle did not record a new lease larger than 150,000 square feet during the first half of 2026. Vancouver completed three leases above that size, even though a shortage of suitable buildings may have limited additional deals.

Recent Vancouver-area tenants included Pantos Logistics, D-Home International, and S&S Activewear. These companies selected space in Delta and Surrey, two locations with strong freight connections.

The key difference is not simply that Vancouver has more tenant demand. It also has fewer large spaces ready for occupancy. Among newer warehouse properties, only three available options could handle requirements of up to 140,000 square feet, and two of those were subleases. A larger user had just one additional project under construction to consider.

Construction Decisions Are Shaping the Results

Development pipelines help explain why the markets are performing so differently.

Seattle added approximately 4.9 million square feet of industrial space over the previous year. Much of its active pipeline was speculative, meaning construction moved forward without tenants committed to the buildings.

Vancouver delivered about 2.2 million square feet of non-condominium industrial space during the same period. Its developers had already reduced construction activity in 2024, bringing the current pipeline to its lowest level in a decade.

Vancouver also has more certainty within the projects that remain underway. About 68% of its construction pipeline has already been committed to tenants, compared with approximately 47% in Seattle.

Many Vancouver projects are being developed for specific users, including Canfor, Martin Brower, Purolator, Red Bull, and Tesla. Built-to-suit development reduces leasing risk because a tenant is attached to the project before completion.

Seattle is now in a supply-absorption period. Landlords must fill recently delivered buildings before the market can return to a healthier balance. Vancouver is in a different stage: limited construction and continued tenant demand are gradually reducing available inventory.

This creates several practical takeaways:

• Strong demand does not protect a market from overbuilding.
• Speculative development increases risk when leasing slows.
• Preleased and built-to-suit projects offer greater income certainty.
• Large blocks of available space can increase tenant negotiating power.
• A limited pipeline can support occupancy and rental rates.

Local Insight: What Boise Should Learn From Both Markets

Boise industrial real estate does not need to match Seattle’s scale to experience similar supply pressure.

A handful of large speculative projects can materially change the Treasure Valley market. That is especially true when several buildings target the same tenant profile, size range, clear height, and geographic area.

For Boise developers, the main lesson is to separate general economic growth from actual tenant demand. Population gains and business expansion may support industrial development, but they do not guarantee that every proposed warehouse will lease on schedule.

Before starting a speculative project, developers should study:

• Active tenant requirements
• Competing space under construction
• Existing vacancies and subleases
• Recent leasing velocity
• Tenant size requirements
• Access to Interstate 84 and major freight routes
• Labor availability
• Power and utility capacity
• Expected operating expenses
• The cost of carrying vacant space

The location of new Boise development also matters. A well-designed warehouse may still struggle if trucks cannot reach it easily, employees face long commutes, or nearby infrastructure cannot support the intended use.

For tenants, increasing supply can create opportunities. Businesses may gain access to newer buildings, better loading, higher clear heights, improved power, and more favorable lease terms. Companies approaching a renewal should compare their current space with both completed buildings and projects scheduled for delivery.

Landlords should watch sublease inventory closely. Sublease space can compete aggressively with direct vacancies, especially when an existing tenant is motivated to reduce its financial obligation. Owners may need to offer flexible terms, tenant improvements, free rent, or other concessions to protect occupancy.

Investors should look beyond a property’s current rent roll. A fully occupied industrial building may appear secure, but future value depends on lease expiration dates, tenant credit, replacement rents, nearby construction, and the amount of competing space expected when leases roll over.

My Take

Seattle and Vancouver show what happens when development pipelines respond differently to changing demand.

Vancouver slowed construction before vacancy became a larger problem. That restraint, combined with steady leasing, is now tightening its industrial market. Seattle built more aggressively and must give tenants time to absorb the additional space.

For Boise commercial real estate, the smartest path is disciplined growth. Developers should confirm that proposed buildings meet real tenant needs instead of relying only on broad market optimism. Landlords should stay competitive on lease structure and building quality. Tenants should use changing supply conditions to evaluate their options early.

Industrial markets rarely move in a straight line. Boise can continue to grow while still experiencing temporary pockets of excess supply. Understanding that difference will help investors, landlords, tenants, and developers make better decisions through the next stage of the market cycle.

Mike Gioioso (joy-OH-so) has for 16+ years been helping companies of all sizes buy, build, and lease perfect places for business in greater Boise, Idaho and beyond.
www.streetsmartidaho.com mike@streetsmartidaho.com 208-209-9166

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