New Year, Same Industrial Market: What’s Really Happening in Reno-Sparks
We’re into a new year, but the industrial real estate story in Reno-Sparks feels familiar. After years of explosive growth, shifting supply and demand dynamics have pushed the northern Nevada market into a more balanced, cautious phase. The market isn’t collapsing or booming wildly. Instead, it’s grinding, recalibrating and giving us a clear read on where things are headed.
Vacancy and Supply: Higher but Stabilizing
By the end of Q4 2025, the Reno-Sparks industrial vacancy rate was tracking around 12 percent, up from roughly 10.5 percent earlier in the year and higher than this time last year. This rise is largely a function of new deliveries hitting the market without full tenancy, pushing vacancy up as supply has outpaced tenant demand.
What this tells us is simple. Developers built aggressively coming out of the pandemic and into early 2024. That wave of speculative product is now here, adding a ton of inventory that tenants haven’t absorbed yet. That’s a pattern we saw nationally too, where industrial vacancy climbed as supply surged. Wall Street Journal
Leasing Activity: Positive Absorption But Not Breakout
Despite rising vacancy, absorption hasn’t disappeared. The Reno industrial market posted positive net absorption, even as supply pressures ramped up. That’s a stabilizing sign. Tenants are still taking space. They’re just more selective.
In plain terms: the market isn’t retreating. Absorption isn’t huge or headline-grabbing, but it’s consistent enough to show demand hasn’t evaporated entirely. Tenants look for quality buildings or strategically located space. They are cautious, not afraid.
Asking Rents: Pressure, But No Freefall
Leasing rates have come down in a few areas, depending on the product. Overall, rents are still holding steady. They’re simply adjusting to the reality of more space available and more negotiating leverage on the tenant’s side.
What you’re seeing in the data is a market that’s recalibrating rent expectations rather than collapsing. For landlords that can offer built-out space, attractive lease terms and flexibility, there’s still good opportunity to transact.
What This Means for 2026
So what do we take into the new year?
It’s a slower, more selective market. Industrial isn’t running wild the way it was in 2021–2023, but it’s not weak either. Vacancy isn’t crippling, tenants are active, and deals are getting done. That’s classic balanced market territory.
Developers and landlords need to be strategic. New deliveries are welcome, but only if they meet tenant needs with location, size, and features that matter. Build-to-suit and flexible deals are winners.
Tenants have leverage. That means looking beyond headline rent rates to real-world occupancy costs. Concessions, shorter terms, tenant improvement allowances and creative deals are part of the toolkit now.
Investors watch fundamentals not headlines. Cap rates have adjusted, and risk is priced differently. Markets with stable demand and traffic generators like TRIC continue to attract interest, even in a softer cycle.
Bottom Line
New year, same industrial market in Reno-Sparks, only it’s more mature now. It’s not the frothy seller’s playground of the boom years, but it’s not a slump either. Vacancy is elevated. Tenants are deliberative. Rents are adjusting. That’s not bad. It’s a market that’s figuring itself out.
If you’re a tenant considering a move, renewal or expansion in Reno-Sparks, this market offers more flexibility than we’ve seen in years. If you want a clear view of your options and a strategy that puts your business first, reach out. I’d be glad to help.
