Savannah industrial development after the supply wave

Where Savannah stands after the supply wave

Savannah spent the last cycle as the fastest-expanding industrial market on the East Coast, and 2026 is the year the market digests what it built. Per Lee & Associates' Q4 2025 Savannah industrial report, vacancy held at 14.1 percent in Q4 2025, unchanged from Q3, as 2.3 million SF of new deliveries met 834,890 SF of net absorption.

The forward pipeline is the real story. Under-construction volume fell to 4.0 million SF from 5.0 million SF a quarter earlier, and that figure excludes the Hyundai Metaplant's roughly 5 million SF build-to-suit campus. Lee's quarterly series shows 2025 net absorption of roughly 7.3 million SF for the year, front-loaded by a 4.7 million SF first quarter. Development discipline plus intact demand is the setup for vacancy to grind down through 2026 rather than up.

One caution for underwriters comparing reports: Cushman & Wakefield's Savannah MarketBeat has the market entering Q1 2026 at 9.9 percent overall vacancy. That is not a contradiction of Lee's 14.1 percent so much as a different inventory baseline and tracking methodology. Pick one provider per metric in your model, footnote which one, and never average the two.

The port engine underneath the real estate

Savannah industrial demand is a derivative of container volume, and container volume keeps setting near-records. The Georgia Ports Authority moved nearly 5.7 million TEUs in calendar 2025, up 2.6 percent (146,000 TEUs) over 2024 and second only to the roughly 5.9 million TEUs of 2022, across 1,669 container ship calls.

That volume is what backfills big-box space. The largest Q4 2025 lease in Lee's report was Smart Supply Chain taking 594,522 SF at 122 Dorchester Village Rd in Midway, followed by JF Fulfillment at 482,755 SF in Bloomingdale. Both are new leases, not renewals, which is the demand signal that matters in a market working through double-digit vacancy on some baselines.

For a development team, the port data is the underwriting anchor. Container throughput growing at low single digits supports steady tenant demand; it does not support the 2022-era assumption that any spec box leases during construction. The market has moved from land-rush math to absorption math.

What traded in Q4 2025, with names and numbers

Rolling 12-month sales volume held at $1.3 billion, with Q4 pricing averaging $133 per SF, up from $130 in Q3, per Lee & Associates. Institutional buyers took 42 percent of 2025 volume and private buyers 33 percent, with users at 19 percent.

The named trades give developers real exit comps:

• Ares Industrial Real Estate Income Trust bought 110 Little Hearst Pky Building 2 in Pooler (Port Wentworth submarket), 281,467 SF, from EQT Real Estate for $36.2 million, or $128.61 per SF, as part of a portfolio sale.
• Pattillo Industrial Real Estate bought 1000 Gateway Pky Building 1E in Rincon (Effingham County), 380,800 SF, from BROE Real Estate for $52.5 million, or $137.89 per SF.
• Pattillo also took 1010 Branch Rd Building 2E in Rincon, 248,000 SF, for $33.4 million, or $134.64 per SF, from the same seller.

The spread matters: recent institutional-quality product in port-adjacent submarkets is clearing in a band of roughly $128 to $138 per SF. If your development pro forma needs a $160 per SF exit to pencil, the Q4 tape does not support it yet.

The 2026 delivery calendar

Lee's construction table lists what lands next. The largest 2026 deliveries include Central Port Logistics Center Building 6 (769,500 SF, Outlying Chatham County, Q1), Savannah Interchange Park (670,022 SF, Q2), Savannah Gateway Industrial Hub Building 2F (584,820 SF, Effingham County, Q2), and Port Wentworth Commerce Center (538,775 SF, Q2). Three more Horizon 16 Industrial Park buildings totaling roughly 657,000 SF follow through Q3.

Run the supply-demand math a lender will run on your deal. Absorption over the last three quarters of 2025 totaled about 2.6 million SF, an annualized pace of roughly 3.5 million SF. Against 4.0 million SF under construction, that is about 14 months of pipeline at the current demand pace, before touching existing vacant stock. A spec building delivering mid-2026 should be underwritten with 12 to 18 months of lease-up, not the pre-leased-at-delivery assumption of 2022.

Carry the math into dollars. A 280,000 SF spec box at the Q4 average asking rent of $8.54 per SF represents about $2.4 million in annual gross rent. Every quarter of vacancy costs roughly $600,000 in forgone rent plus taxes, insurance, and debt service. On a project capitalized near the Ares comp of $128 per SF ($35.8 million), six months of lease-up slippage moves returns by more than a full point of yield-on-cost. That sensitivity, not the headline vacancy rate, is what should drive your go or no-go on a 2026 start.

Running a Savannah development pipeline

A developer active in Savannah is typically juggling land in Effingham or Bryan County, one or two vertical projects, and a lease-up, each with its own entitlement calendar, GC draws, lender reporting, and broker updates. That is a tracking problem before it is a real estate problem. Teams run it on a pipeline board with a stage for each phase from site control through stabilization, and a deal workspace per project holding the files, key dates, and contacts that otherwise scatter across inboxes. Due diligence tracking is part of deal workspaces, which matters in a market where environmental and wetlands review can decide a site.

Financing outreach runs parallel: construction lenders, credit unions, and debt funds all quoting the same deal, best compared side by side with financing tracking attached to the project record. Teams underwriting multiple port markets can compare this setup against the Inland Empire market brief, and industrial-specific pipeline structure is covered in our guide to deal management for industrial developers. MotionCRE's industrial solution covers both the acquisition and development sides.

The read for 2026

Port-market diligence specifics

Savannah sites carry diligence items inland markets skip. Drayage economics decide the real catchment: a site 30 minutes from the terminal gates competes differently than one at 60, and tenants price the difference. Wetlands are the second: coastal Georgia parcels routinely carry delineation and mitigation questions that belong in screening, not in month two of diligence. Labor is the third, since the same construction wave that filled the pipeline is competing for the same workforce. Developers who standardize these checks screen Savannah land the way locals do.

Savannah is transitioning from expansion-phase chaos to a balanced market with a visible bottom. Vacancy has stopped rising on Lee's baseline, the construction pipeline is down 20 percent quarter over quarter, pricing is firming at $133 per SF, and the port just posted its second-busiest year on record. For developers, the opportunity has shifted from speed-to-market to basis and patience: control good sites now, underwrite honest lease-up periods, and let the thinning pipeline do the work on rents into 2027.