T
he Baton Rouge metro's industrial real estate market remains tight, with a 23-basis point increase in its vacancy rate to 2.22% in Q3 2024, down from 3.03% in Q3 2023. The total vacancy stands at 838,661 square feet, up 90,306 square feet from the previous quarter.

    Despite this increase, the market has seen a net absorption of 492,014 square feet year-to-date, with every parish experiencing positive absorption so far this year. Asking rental rates have risen to $9.88 per square foot, driven by limited supply.

    New construction permits issued rose significantly in Q3 2024, reaching 252,557 square feet, largely due to the 240,000-square-foot 61 North Logistics Center project on Tom Drive. This signals some relief for a market that has been chronically underbuilt, according to Evan Scroggs of Lee & Associates.

    Scroggs notes that these trends are not unique to Baton Rouge and are consistent across markets along the I-10 corridor from Lake Charles to Mobile. The limited supply in the region continues to drive up rental rates, with only 132,618 square feet added to inventory this quarter and just 95,014 square feet expected next quarter.