Portland Industrial & Warehouse Market Report | Q2 2026

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Portland’s industrial market softened again in Q2 2026. Net absorption slipped to −188,274 SF, vacancy rose to 6.5%, and asking rents eased. The construction pipeline grew to 3.4 million SF while little space delivered, so future supply now matters more than space already built.

C&W had not posted its Q2 2026 Portland MarketBeat when this report was prepared. Metro totals therefore come from the Portland, OR rows of Cushman & Wakefield’s Q2 2026 U.S. Industrial MarketBeat, with Q1 2026 as restated there. Submarket detail comes from C&W’s Q1 2026 Portland MarketBeat and is labelled Q1 2026. Portland rents are quoted monthly NNN by market convention; monthly figures here are C&W’s annual rates divided by 12. Kidder Mathews, which reports direct vacancy and total net absorption on its own inventory, put Q2 direct vacancy at 7.0%, total availability at a record 11.1% and net absorption at −868K SF. Those figures are not comparable with C&W’s and are not blended here.

Market Snapshot: Q2 2026

Source: Cushman & Wakefield, U.S. Industrial MarketBeat Q2 2026, Portland, OR rows (vacancy, absorption, leasing, asking rents, deliveries year to date, under construction), with Q1 2026 vacancy, rent and absorption as restated there. Q1 leasing, deliveries and under construction from C&W’s Q1 2026 Portland MarketBeat. Monthly rents are WareCRE conversions of C&W’s annual figures. First-half absorption is the sum of the Q1 and Q2 figures shown. n/a = not published in the Q2 national tables.

Rent Trends: Down 1.9% on the Quarter to $0.91/SF/mo

Portland’s overall asking rent was $10.89/SF/yr NNN in Q2 2026, about $0.91/SF/mo, down from $11.10 (about $0.93/SF/mo) in Q1 as restated and up 0.5% from $10.84 (about $0.90/SF/mo) a year earlier. Warehouse/distribution and manufacturing space both average about $0.88/SF/mo ($10.53 and $10.58/SF/yr).

C&W’s Q1 report described asking rents as “relatively stable despite softening fundamentals,” with landlords using concessions more widely and prioritizing occupancy and credit tenants over rent growth. It expected headline rents to hold while “effective rents may soften as concessions increase.” In Q1, submarket rents ranged from $0.70/SF/mo in Macadam to $1.14/SF/mo in Hillsboro/Sunset Corridor.

Construction Pipeline: 3.4M SF Underway, Up 30.7% in a Quarter

C&W counted 3,433,962 SF under construction in Portland at the end of Q2 2026, up from 2,627,161 SF in Q1. Deliveries were light at 121,340 SF for the first half, so Q2’s vacancy increase came from weaker demand rather than new supply.

In Q1 the pipeline was concentrated in the Southwest group (1,695,364 SF, including 778,720 SF in Canby and 612,675 SF in Tualatin/Sherwood) and Vancouver/Clark County (874,278 SF). C&W’s national tables do not break out the Q2 increase by submarket.

Submarket Breakdown

C&W groups Portland’s submarkets into five areas. Figures below are from C&W’s Q1 2026 Portland MarketBeat, the latest local release; metro totals above are Q2 2026.

North/Northeast (Columbia Corridor)

The largest area at 86.5 million SF, covering East Columbia, Rivergate, Airport Way, Swan Island and Northeast Portland. Vacancy was 6.5% in Q1 and availability 7.9%. It led Q1 demand with 436,311 SF of net absorption, most of it in East Columbia (328,934 SF). Rents averaged $0.85/SF/mo, and only 57,519 SF was under construction. The Columbia River Collection (520,872 SF) in East Columbia sold for $81.2 million, or $156/SF.

Southwest (Hillsboro and I-5 South)

72.5 million SF at 5.1% vacancy. The area includes Hillsboro/Sunset Corridor, home to the Silicon Forest semiconductor cluster (3.3% vacancy, $1.14/SF/mo), and the I-5 south submarkets of Tualatin/Sherwood (9.5%) and Wilsonville (5.7%). The Southwest lost 244,008 SF in Q1 and held the largest pipeline at 1,695,364 SF. Rents averaged $1.03/SF/mo, the highest of the five areas.

Vancouver/Clark County

30.5 million SF across the Columbia River in Washington, at 9.6% vacancy in Q1. It led Q1 leasing with 633,072 SF, including a 283,622 SF new lease at Hidden Glen Industrial Center, and delivered all 63,215 SF of the quarter’s new space. 874,278 SF was under construction. Rents averaged $0.93/SF/mo.

Southeast

31.0 million SF at 4.5% vacancy, including Clackamas/Milwaukie (3.9%) and Southeast Portland (7.1%). The Southeast lost 33,587 SF in Q1, had no construction underway and averaged $0.80/SF/mo, among the lowest rents in the metro.

Source: Cushman & Wakefield, Portland Industrial MarketBeat Q1 2026, market statistics table (rents are overall weighted net asking, monthly NNN). Q1 totals as first published; the Q2 national tables restate Q1 vacancy to 6.4% and absorption to 338,127 SF.

Co-Warehousing & Flexible Warehouse Space in Portland

The smaller end of Portland’s industrial market has loosened this cycle. Kidder Mathews reported in Q1 that vacancy in the small-bay segment under 50,000 SF had more than doubled after a period of outperformance. That gives smaller users more choice and room to negotiate.

Food and beverage producers, contractors and e-commerce operators make up much of Portland’s flexible-space demand. Makers, light manufacturers, and semiconductor and tech suppliers in the western corridor round out the tenant base.

Browse available co-warehousing and small-bay warehouse listings on WareCRE’s Portland marketplace.

Key Trends to Watch: Portland Industrial Market Trends 2026

1. Demand Turned Negative Again in Q2

Net absorption was negative in four of the last five quarters in C&W’s series: −223,846 SF in Q2 2025, −227,770 SF in Q3, −161,034 SF in Q4, a positive 338,127 SF in Q1 2026, then −188,274 SF in Q2. New leasing fell to 914,710 SF from 1,476,591 SF in Q1. Kidder Mathews called its own Q2 leasing count the lowest quarterly volume since 2008.

2. Sublease Space Keeps Growing

Kidder Mathews reports sublease availability has risen from less than 1 million SF in 2022 to nearly 5 million SF in Q2, driving its availability rate to a record 11.1%. Sublease listings compete with direct space and put pressure on effective rents. Read more: Small-Bay vs. Big-Box: What the Vacancy Gap Means in 2026.

3. Hillsboro and Swan Island Stay Tight

Portland’s softness is uneven. In Q1, Swan Island (3.0%), Hillsboro/Sunset Corridor (3.3%) and Clackamas/Milwaukie (3.9%) had the lowest vacancy among the larger submarkets, while Northwest Portland (11.5%) and Tualatin/Sherwood (9.5%) had the highest. Hillsboro also commands the metro’s top rent at $1.14/SF/mo.

Outlook: What to Watch in Q4 2026

C&W’s Q3 2026 MarketBeats are due in mid-October, with the year-end release to follow. C&W’s Q2 Portland MarketBeat has not yet been posted, so those releases will also bring the first local detail for 2026’s second half.

Watch whether absorption returns to positive. Q1’s 338,127 SF gain proved short-lived, and a second negative quarter in Q3 would push vacancy further above 6.5%.

Watch how much of the 3.4 million SF pipeline is preleased. The pipeline grew 30.7% in Q2, and the next local report should show where the new projects are and how much space is committed.

C&W’s Q1 report expected headline rents to hold, but its preliminary Q2 figure fell 1.9%. The next releases will show whether the decline continues or landlords keep adjusting through concessions.

Data sources: Cushman & Wakefield U.S. Industrial MarketBeat Q2 2026, Portland, OR rows (Q2 2026 metro totals and restated Q1 2026 and Q2 2025 figures; rents NNN, $/SF/yr, converted to $/SF/mo; U.S. averages); Cushman & Wakefield Portland Industrial MarketBeat Q1 2026 (submarket detail, Q1 leasing, deliveries and construction; rents monthly NNN); Kidder Mathews Portland Industrial Market Report Q2 2026 (direct vacancy, availability, absorption, sublease and leasing cross-check only); Kidder Mathews Portland Industrial Market Report Q1 2026 (small-bay commentary only). C&W’s Q2 2026 Portland MarketBeat was not available at the time of publication. Each report reflects the most recent vacancy, rental, and construction data available at the time of publication. We refresh our reports as new market data is released, and we’re continually expanding coverage to additional metros.