National median industrial / warehouse PSF rent in 2026 is $10.80/SF NNN. Coastal logistics hubs (LA Inland Empire, NJ Port, Seattle/Tacoma) run $18.20/SF NNN per Prologis Industrial Index Q1 2026. Modern logistics buildings (32+ foot clear height, cross-dock loading) command 20 to 35% premiums over older infill warehouse stock.
TL;DR
Industrial rent in 2026 split sharply between modern logistics and older infill stock. Modern logistics (32+ foot clear, cross-dock, 50+ truck doors) commands premium rents in coastal hubs serving major ports. Older infill warehouse offers cheap base rent but low operational efficiency. Industrial TI is much smaller than office: $5 to $15/SF for shell upgrades. Most landlords deliver “gray-shell” with tenant-funded buildout for office, racking, and dock equipment.
Industrial rent by submarket type (Q1 2026)
| Submarket type | Typical $/SF/yr NNN | Examples |
|---|---|---|
| Coastal port logistics | $14 to $24 | LA/Inland Empire, NJ Port, Seattle/Tacoma, Savannah |
| Major distribution hub (interior) | $7 to $12 | Memphis, Indianapolis, Dallas, Atlanta |
| Last-mile (urban infill) | $14 to $30 | Brooklyn, Long Island City, Chicago infill |
| Older infill warehouse | $5 to $10 | Most secondary markets, older buildings |
| Flex space (warehouse + office) | $9 to $18 | 30 to 50% office buildout |
| Cold storage | $14 to $28 | Specialized; meaningful refrigeration premium |
National median: $10.80/SF NNN per Prologis Industrial Index Q1 2026.
What drives industrial rent premiums
Five physical features that command premium pricing:
- Clear height: 32 feet is modern logistics standard; 24 to 28 feet is older. Each additional 4 feet of clear height adds 8 to 12% to rent.
- Cross-dock loading: docks on both sides of the building enable through-put logistics. 20 to 30% premium vs single-side dock.
- Truck door ratio: modern logistics is 1 dock door per 5,000 to 10,000 SF. Older buildings often 1 per 20,000 SF, limiting throughput.
- Trailer parking ratio: 1 trailer space per 5,000 SF for modern e-commerce vs 1 per 20,000 SF for older infill.
- Floor flatness / load capacity: rack-storage operations need FF35+ floor flatness and 250+ PSF floor load capacity.
Per Cushman & Wakefield Industrial Insight and JLL Industrial Market Statistics, modern logistics product trades at 25 to 40% premium to older infill in the same submarket.
Warehouse vs flex space
The economic distinction:
- Warehouse: storage with limited office buildout (typically <10% office). Lowest PSF rent.
- Flex space: 30 to 50% office buildout in addition to warehouse. 30 to 50% rent premium per SF over warehouse.
- Industrial showroom: heavy storefront/showroom + warehouse rear. Closest to retail economics. Highest PSF for industrial use.
Choose by use mix. Light manufacturing, R&D, and distribution-with-customer-pickup typically need flex. Pure storage or fulfillment can stay in straight warehouse.
Industrial TI allowance and buildout
Per LoopNet Industrial TI Guide and Prologis tenant fit-out data:
| Buildout type | TI allowance ($/SF) | Notes |
|---|---|---|
| Gray-shell base building | $5 to $15 | Standard delivery for warehouse |
| Warehouse with limited office | $8 to $20 | Includes basic office + restrooms |
| Flex space (30 to 50% office) | $25 to $50 | Office finish driving cost |
| Cold storage retrofit | $40 to $100 | Refrigeration build is specialized |
Typical industrial TI is much smaller than office because the landlord is delivering relatively unfinished space. Tenant funds buildout for racking, additional dock levelers, conveyors, and operations equipment.
Specific equipment costs the tenant typically pays out of pocket:
- Racking: $5 to $15/SF for selective rack; up to $30/SF for VNA or AS/RS systems
- Dock levelers and equipment: $8K to $15K per dock door
- Material handling (forklifts, conveyors): $50K to $500K+ depending on operation
How to evaluate an industrial space
Five questions before LOI:
- What’s the clear height under joist? Modern logistics needs 32+ feet. Below 24 feet limits operations.
- What’s the dock door count and configuration? Cross-dock vs single-side matters for throughput.
- What’s the trailer parking ratio? Critical for e-commerce and high-throughput logistics.
- What’s the floor flatness and load rating? Rack storage needs FF35+ and 250 PSF.
- What’s the access to highways and rail? Highway access is critical; rail access is bonus for heavy industries.
Frequently asked questions
What’s the difference between a warehouse and a flex space lease?
Warehouse is mostly storage with limited office (typically <10% office buildout). Flex space has 30 to 50% office buildout. Flex commands a 30 to 50% rent premium per SF over warehouse.
Are loading docks and clear height priced into PSF?
Yes. Modern logistics buildings (32+ foot clear, cross-dock loading) command a 20 to 35% premium over older infill warehouse stock. Each 4 feet of additional clear height adds 8 to 12% to rent.
What’s a typical industrial TI allowance?
Industrial TI is much smaller than office: $5 to $15/SF for shell upgrades, plus dock-leveler / lighting / racking allowances negotiated separately. Landlords often deliver “gray-shell” with tenant-funded buildout for racking and operations equipment.
Why is industrial rent rising in 2026?
E-commerce demand, near-shoring of manufacturing, and limited new construction in coastal submarkets drove industrial rent up roughly 8% nationally vs 2024. Coastal port logistics has been the strongest segment.
What’s a typical industrial term length?
5 to 10 years is the most common range. Larger logistics tenants (Amazon, FedEx, Walmart) sign 10 to 15 year deals with build-to-suit terms. Smaller tenants sign 5 year deals more commonly.
Are NNN charges higher in coastal industrial markets?
Yes. Property tax in California (LA Inland Empire) and New Jersey (Port) runs above national median, and insurance pass-through is higher in coastal hurricane-exposed markets like Houston and Miami. Add 20 to 40% on NNN for coastal vs interior markets.
Should I sign a build-to-suit for industrial?
For 100,000+ SF specialty use (cold storage, automated fulfillment, specialty manufacturing), build-to-suit is common and economically similar to ownership. For standard logistics under 100,000 SF, lease the existing market product.
What’s the typical industrial broker commission?
4 to 6% of gross rent over the term, paid by the landlord, same structure as office. Industrial brokers often have specialty expertise in clear-height and dock-loading specs that generalist brokers lack.
Related guides
- Pillar: all-in commercial lease cost calculator
- Commercial lease cost per square foot metro index
- NNN lease calculator
Sources
- Prologis Industrial Index Q1 2026 accessed 2026-05-02
- Cushman & Wakefield Industrial Insight accessed 2026-05-02
- JLL Industrial Market Statistics accessed 2026-05-02
- NAIOP Industrial Market Trends accessed 2026-05-02
Not financial or legal advice. Estimates based on publicly available market data and broker reports. Commercial real-estate is highly local and deal-specific. Consult a licensed commercial real-estate broker and a real-estate attorney before signing any lease.