Las Vegas Industrial Market Analysis: October 2025

2. Las Vegas Industrial Market Context: A Temporary Imbalance

To understand the Q3 sales data, it is essential to establish the “customary perspective” of the underlying market fundamentals. The current high vacancy rate is a supply-driven, temporary phenomenon, not a signal of a demand-side collapse.

The Dual Narrative: Supply & Demand

The primary market driver is a wave of new supply. In Q3 2025, 1.8 million SF of new industrial product was delivered. This pushed the total year-to-date deliveries to 5.0 million SF. This influx of new inventory, much of it speculative, is the direct cause of the rise in vacancy.   

This new supply is, however, masking healthy tenant demand. The market posted 1.3 million SF of positive net absorption in Q3. This figure, the “strongest quarterly performance of the year,” confirms that businesses are actively leasing space and expanding. A market with rising vacancy but negative absorption would signal a recession. A market with rising vacancy and positive absorption, as seen here, signals a “temporary imbalance” where new construction is simply coming online faster than tenants can physically occupy it.   

Unpacking the “Vacancy” Headline: The Great Bifurcation

The most critical insight for any investor is found by deconstructing the headline vacancy statistic. The market-wide rate of 10.2% (per CBRE) or 11.6% (per Cushman & Wakefield) is not uniform. The vacancy is heavily concentrated in one specific asset class, a trend mirrored in leasing activity :   

• Bulk (>100k SF) Vacancy: This segment is soft, with vacancy at 15.1%. Landlords in this space are using “adaptive leasing strategies,” including rate compression and enhanced concession packages, to attract tenants.   
• Shallow-Bay (<50k SF) Vacancy: This segment remains very tight at 5.4% vacancy. These assets “continue to outperform the broader market”.   

This leasing fundamental directly explains the sales data presented in this report. In Q3, 95% of all leasing transactions involved footprints under 50,000 SF. This intense demand and low vacancy for small space create strong rent growth, which in turn attracts two powerful buyer pools: premium-paying owner-users (escaping rent volatility) and investors (seeking stable cash flow). The Q3 sales market is a direct mirror of this leasing bifurcation.

3. Sales Market Momentum: Transaction Velocity & Volume (Aug-Oct 2025)

A chronological analysis of the 34 closed sales from August through October provides a clear view of market momentum. The core dataset of 28 priced sales, totaling $116.83 million and 500,189 SF, shows a market that was institutionally top-heavy in September and dominated by shallow-bay assets in October.²

The monthly breakdown is as follows:

• August 2025: 12 priced sales | $45.13M Volume | 185,223 SF Sold | Avg. $243.65/SF
• September 2025: 11 priced sales | $65.23M Volume | 280,337 SF Sold | Avg. $232.68/SF
• October 2025: 5 priced sales | $6.47M Volume | 34,629 SF Sold | Avg. $186.95/SF

The velocity and volume metrics are best visualized in the following table.

Table 1: Q3 2025 (Aug-Oct) Monthly Sales Metrics

At first glance, October appears to represent a dramatic slowdown, with sales volume falling 90% from September and the average price per SF dropping. However, this is not a market crash but a change in the asset mix being sold. September’s volume was dominated by the quarter’s largest institutional deals, including the $23.5 million sale of 3130 N Lamb Blvd and the $13.9 million W Post Rd portfolio.²

In contrast, October’s activity consisted entirely of sub-$3 million, shallow-bay assets. Furthermore, the October average of $186.95/SF is misleadingly low, skewed downward by one significant outlier: the sale of 4300 N Pecos Rd, which traded for just $27.38/SF. Without this single transaction, the October average for the remaining four properties would be $276.71/SF, a figure that reinforces the strong pricing for shallow-bay assets.

The momentum for large institutional deals paused in October, but momentum for small-bay assets continued.

4. Pricing & Valuation Analysis: The Tale of Two Markets

The quarter’s weighted-average price of $233.57/SF is a statistically misleading figure for advisory purposes. The 28 priced sales in the dataset ranged from a low of $27.38/SF (4300 N Pecos Rd) to a high of $1,250/SF (2861 Losee Rd).² This $1,223 spread is not driven by a unified market but by vastly different asset utilities.

Identifying Specialty Assets (IOS)

To find the true “building” values, two high-priced outliers must be isolated, as their value is primarily in the land and its specialized use.

1. High Outlier 1: 2861 Losee Rd (Sold $1,250/SF). This is not a warehouse sale. It is an Industrial Outdoor Storage (IOS) transaction. The buyer is “Jadian IOS,” a firm specializing in this asset class. The value is in the 3.4-acre lot (148,104 SF), not the small 4,400 SF building. The price per land SF was $37.14.²
2. High Outlier 2: 715 W Bonanza Rd (Sold $760/SF). This transaction involved a 5,000 SF building on a large 1.3-acre lot. This 75-year-old, Class C building is a redevelopment or high-land-value play.²

These sales confirm a highly robust sub-market for land-heavy industrial sites. For the remainder of this analysis, these transactions are excluded to determine true building values.

Class B Pricing > Class A Pricing

After excluding the IOS/land outliers, the data reveals a counter-intuitive but critical trend: on average, Class B assets commanded a 17% price premium over Class A assets.

• Class A (2 sales): $247.90/SF (Weighted-Avg.)
• Class B (17 sales): $290.05/SF (Weighted-Avg.)
• Class C (7 sales): $177.30/SF (Weighted-Avg.)

This phenomenon is the clearest evidence of the market’s bifurcation. The Class A sales are large bulk assets (e.g., 3130 N Lamb at 104k SF). This segment is suffering from 15.1% vacancy ⁴, and the new supply pipeline is pushing prices down. Conversely, the Class B sales are almost exclusively small, infill, shallow-bay assets (e.g., 3061 Business Ln, 3475 W Post). This segment has a tight 5.4% vacancy ⁴, and intense competition from users and 1031 buyers is pushing prices up.

The “flight to quality” in the current market is not for building class (A vs. B) but for asset type (Shallow-Bay vs. Bulk). The “sweet spot” of the entire Las Vegas investment market is stabilized, Class B, infill, shallow-bay industrial.

Pricing by Submarket

Geographically, the SW Las Vegas submarket was the epicenter of transactional activity, leading in velocity and commanding premium pricing. This aligns with leasing reports that identify the Southwest as a primary submarket for tenant demand.⁸

Table 2: Pricing Analysis by Submarket (Warehouse/Flex Comps)

5. Key Transactions & Capital Markets Insights

Aggregated data must be supported by an analysis of individual deals to understand buyer motivations. The quarter’s sales show a healthy mix of institutional investors, private 1031 exchange buyers, and local owner-users, all competing for different products.

Table 3: Notable Transactions (Aug-Oct 2025)

Analysis of Capital Flows

The market is supported by a durable mix of capital. The proprietary data shows 18 National buyers and 10 Local buyers, demonstrating both strong local business growth and sustained national institutional interest.²

The buyer pool is defined by a “barbell” effect.

• Owner-Users: Buyers like Impact Sign (6265 Saddle Tree), Sahara Concrete (989 Empire Mesa), and Ferraro Marble (3515 Birtcher) are acquiring buildings for their operations.² These buyers are less sensitive to capitalization rates and are paying premiums for utility and the long-term benefit of controlling real estate costs in a tight leasing market.
• Investors: This group is dominated by high-net-worth individuals and private capital, often driven by tax advantages. The transactions for 5967 Harrison Dr, 5137 W Oquendo Rd, and 2960 E Sunset Rd (a 3-condo portfolio) were all driven by investors, with several explicitly noted as a 1031 Exchange.²

The shallow-bay market is so competitive because these two powerful buyer pools are competing for the same, scarce asset. Owner-users set a high-water mark on price, while time-sensitive 1031 exchange buyers create a high floor. This “capital squeeze” is a primary driver of the premium pricing observed in Class B infill properties.

6. Liquidity and Time on Market: Measuring Market Friction

The “Market Time” data addresses the client’s query on liquidity. Analysis of the 18 sales for which this data is available reveals that high time-on-market is a function of mispricing, not a lack of market liquidity.   

• Average Days on Market (DOM): 220 days
• Median Days on Market (DOM): 238 days

This high average is driven by “stale” listings, such as 4125 Wagon Trail Ave (469 days) and 3125 Venture Dr (391 days). This 220-day average does not mean the market is slow. It means the market is efficient at identifying mispriced assets. This is proven by a clear correlation between DOM and the discount from the original asking price.   

• Case Study 1 (The Stale Asset): 4125 Wagon Trail Ave
  • DOM: 469 days
  • Asking Price: $5,850,000
  • Sale Price: $2,880,000
  • Discount: 50.8%    
• Case Study 2 (The Correctly-Priced Asset): 4340 E Alexander Rd
  • DOM: 45 days
  • Asking Price: $825,000
  • Sale Price: $825,000
  • Discount: 0%    
• Case Study 3 (The Market-Priced Asset): 5137 W Oquendo Rd
  • DOM: 80 days
  • Asking Price: $3,321,000
  • Sale Price: $3,150,000
  • Discount: 5.1%    

This data provides a clear ultimatum for sellers: Price an asset to the market, and it will sell in 45-90 days at 95-100% of the asking price. Price an asset aspirationally (e.g., to 2022 levels), and it will sit for over a year, ultimately selling for a 50%+ discount.

7. Forward-Looking Analysis: The “Under Contract” Pipeline

The 14 assets in the dataset listed as “Under Contract” provide a direct leading indicator for Q4 2025 and Q1 2026 closings. This pipeline confirms that the market’s bifurcation is accelerating.

• Transactions Pending: 14
• Total Volume (Asking Price): $60.2 Million
• Total Square Footage: 315,190 SF
• Weighted-Average Asking $/SF: $190.99/SF ²

The $191/SF average asking price for pending deals is significantly lower than the $234/SF average for Q3’s closed deals. This compression is driven by one asset: 4335 Arcata Way, a 219,485 SF Class A warehouse that accounts for 70% of the entire pending square footage. Its asking price is just $139.73/SF.²

This asset demonstrates the price discovery and compression happening in the bulk segment. The rest of the pipeline is composed of the small-bay assets that are commanding premium pricing, as shown in the table below.

Table 4: Forward-Looking Pipeline Highlights

The forward-looking pipeline is the clearest evidence of the two-speed market. Institutional price discovery is compressing (to $140/SF) in the bulk segment, while the shallow-bay segment is accelerating ($370-$900/SF).

8. Concluding Insights & Strategic Advisor Recommendations

The Q3 2025 sales data reveals a market that is healthy but bifurcated. It is not collapsing; it is specializing. The headline vacancy rates are isolated to the bulk segment and are offset by strong, positive net absorption, proving durable tenant demand.⁵ Based on this analysis, strategic recommendations are as follows:

For Investor Clients (Buyers)

• Thesis: Do not be deterred by headline vacancy rates. The market is bifurcating, and the shallow-bay segment remains supply-constrained with tight vacancy (5.4%) and strong leasing velocity.⁴
• Opportunity 1 (Value-Add): The data shows that assets explicitly noted with “High Vacancy” (e.g., 5148 W Patrick Ln, 3644 E Sunset Rd) are successfully trading.² With the market absorbing +1.3 million SF per quarter ⁵, this presents a clear opportunity to acquire well-located, vacant buildings at a discount and execute a lease-up strategy in a market with proven demand.
• Opportunity 2 (Core/Core-Plus): The “sweet spot” is stabilized, Class B, infill shallow-bay ($< 50,000$ SF). Leasing fundamentals are strong, and sales data confirms this segment’s premium (average $290/SF for Class B).² This is a “safe” play for stable cash flow, but be prepared to compete on price with highly motivated 1031 exchange buyers and owner-users.

For Owner-User Clients (Buyers)

• Thesis: This is an excellent time to acquire property. With leasing fundamentals for shallow-bay space extremely tight, controlling real estate costs via ownership is a powerful long-term strategy to insulate a business from rent volatility.
• Market Position: You are the dominant buyer in your segment. The data shows owner-users (e.g., Impact Sign, Sahara Concrete) are consistently acquiring properties.² An owner-user can justify a price premium that investors (bound by cap rates) cannot, especially for assets with specific utility (e.g., yard space, power, clearance).
• Recommendation: Target properties that have lingered on the market (200+ DOM). The data analysis of “Time on Market” proves these sellers are mispriced and are far more likely to negotiate. The 4125 Wagon Trail sale (50.8% discount after 469 days) is the prime example of this strategy’s potential.²

For Seller Clients

• Thesis: Pricing is the only variable that matters. The 220-day average DOM is a false flag; it is an average of 45-day sales and 450-day sales. The market is efficient, not slow.
• Shallow-Bay Owners ($< 50,000$ SF): You are in the driver’s seat. Your asset class is scarce (5.4% vacancy) and in high demand from two deep-pocketed buyer pools.⁴ A marketing strategy should be designed to target both 1031 exchange investors and local owner-users to create a competitive bidding environment.
• Bulk Building Owners ($> 100,000$ SF): You are in a “show me” market. You are competing with 1.8 million SF of new deliveries and 15.1% vacancy.⁴ Price your asset in line with the new institutional benchmarks ($225/SF or less, per the 3130 N Lamb sale).² Be prepared to offer “adaptive” strategies, including leasing concessions ⁴ or seller financing, to differentiate your asset.
• The “Price It Right” Ultimatum: The sales data is unambiguous. Price your asset to today’s market, and it will sell in 45-90 days at 95-100% of ask. Price it to 2022’s market, and it will sit for over a year and sell at a 50% discount.²