The U.S. cold storage sector is undergoing a market recalibration that is accelerating the divide between legacy and modern facilities. Despite near-term headwinds from oversupply, lower food inventories and U.S. policy uncertainty, the sector’s long-term outlook remains positive, with structural catalysts set to drive growth.
In this new report, Newmark explores real estate fundamentals across key cold storage markets, how consumer behavior and supply chain strategies are influencing demand performance and what investors, occupiers, and developers should monitor as the market continues to evolve.
Key Takeaways:
- Supply Pressures: The U.S. cold storage pipeline has dropped from record highs yet remains historically elevated, totaling 7.4 million square feet, with approximately 10% of the current inventory built in the last five years.
- Rent Growth: Average cold storage taking rents have grown over 100% since 2020. Higher prices are driving some occupiers to explore building and/or owning their own facilities.
- Demand Catalysts: Structural drivers such as rising domestic food production investments and online grocery sales growth are creating long-term tailwinds for cold storage.
- Aging Infrastructure: While new supply is pressuring vacancy, most vacant space on the market is older. With an average age of 42 years, the U.S. cold storage inventory requires continued modernization.
