Mechanicsburg, PA — July 2025 — Vacancy in Eastern Pennsylvania's industrial market held steady at 9.5% in the second quarter of 2025, according to Lee & Associates of Eastern Pennsylvania's Q2 Industrial Intel report. Strong leasing activity across the region was the key factor stabilizing vacancy, with more than 9 million square feet of new leases signed. Leasing was particularly robust in Southern New Jersey (3 MSF), Central Pennsylvania (2 MSF), and Northeast Pennsylvania (1.5 MSF). Demand in these submarkets was driven predominantly by logistics providers, e-commerce companies, and manufacturing firms, effectively pushing vacancy rates lower in each region.

While Eastern PA saw renewed leasing momentum, the broader U.S. industrial market continues to face uncertainty characterized by rising vacancy rates and decelerating leasing volumes. Regionally, construction levels have moderated significantly—down nearly two-thirds from the post-COVID peaks recorded in 2022. This slowdown in new construction activity is expected to provide breathing room, allowing the market time to absorb existing vacancies and new deliveries more effectively.

“The strong leasing activity across the entire Greater Philadelphia region this quarter highlights the area’s strategic importance and continued attractiveness to businesses,” said Heather Kreiger, CCIM, Principal & Regional Research Director at Lee & Associates. “While nationwide economic uncertainty still influences tenant decisions, the robust local leasing activity, especially within our key markets, demonstrates resilience and supports cautious optimism as both developers and tenants recalibrate for the months ahead.”

Media Contact:

Heather Kreiger, CCIM
Regional Research Director | Principal
hkreiger@lee-associates.com | (610) 590-1007