Supply and Construction
Vacancy across Southern New Hampshire’s (SNH) industrial market dropped to its lowest point in two years, down 60 basis points (bps) quarter-over-quarter (QOQ) to 6.1%. Improvements were widespread, with five of seven submarkets recording stable or declining vacancy rates QOQ. Nashua led the market, posting an 80-bp quarterly improvement. Meanwhile, sublease availability remained unchanged at 427,500 square feet (sf), with five spaces 25,000-sf or larger accounting for 88.3% of the total.
One speculative warehouse/distribution project remains under construction, a 40,000-sf building at 93 Dow Road scheduled for completion in Q4 2026. This would make the first and only delivery of the year, and reduce the market’s construction pipeline to zero for the first time in recent market history.
Demand and Pricing
Following a strong first half of the year when 991,000 sf was leased across the market, new demand was muted during the third quarter, totaling 167,000 sf and bringing year-to-date (YTD) leasing volume to 1.2 msf. Despite the decline in square footage, transaction count increased to 27, exceeding both prior quarters and indicating a shift toward smaller leases. Nashua remained the most active submarket, leading quarterly leasing throughout 2026 and accounting for 42.6% of YTD volume. Renewal activity provided further green shoots, totaling 212,000 sf during the third quarter as two tenants occupying more than 100,000 sf opted to remain in place. Amazon’s 109,500-sf renewal at 400 Quality Road was the market’s largest since the end of 2024.
Overall average asking rents continued to increase throughout 2026, reaching a new record high of $12.97 per square foot (psf) in the third quarter. This represented an annual climb of 9.1% following a 4.8% decline over the preceding year. Upticks in rent were widespread with all submarkets recording annual asking rent growth. Salem and Manchester led the increase, rising $2.82 psf and $1.66 psf to $13.29 psf and $11.92 psf, respectively.
Sales
Four industrial buildings totaling 784,500 sf traded during the third quarter, all in the Nashua market. The largest transaction was Anheuser-Busch’s sale of its 683,170-sf property to United Therapeutics Corporation for $47.5 million. Elsewhere in the market, Massachusetts-based Vicor announced plans to expand into New Hampshire and establish a nearly 1.0-msf footprint across two sites in Merrimack and Hooksett.
