Coeur d’Alene Industrial Market Trends – Q1 2025 Report on Vacancy, Rents, and Construction
The Coeur d’Alene industrial market experienced a transitional first quarter in 2025. After years of strong growth, the market is now showing signs of recalibration, with rising vacancies, slower rent growth, and more selective construction activity. Here’s a full breakdown of where the market stands today and what investors, owners, and tenants need to know.
Data sourced from CoStar, Crexi, broker-reported activity, and publicly available information as of April 2025.
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Market Snapshot – Q1 2025
- Total Inventory: 10.8 million SF
- Vacancy Rate: 6.3% (vs. 2.7% five-year average)
- Availability Rate: 7.0%
- 12-Month Net Absorption: 155,000 SF
- 12-Month Deliveries: 206,000 SF
- Rent Growth: 0.3% YoY
- Under Construction: 42,000 SF (across two projects)
Vacancy Rising Amidst Slower Leasing
After peaking in late 2024 at 6.5%, vacancy in the Coeur d’Alene industrial market slightly declined to 6.3% in Q1 2025. The vacancy rate remains significantly above the five-year average of 2.7%, due to a wave of new deliveries and a tapering of tenant demand.
- Logistics vacancy: 10.1%
- Flex vacancy: 3.0%
- Specialized industrial vacancy: 1.2%
The highest vacancy rates are concentrated in Post Falls, where over 546,000 SF of space sits vacant, representing 12% of that submarket’s inventory.
After peaking in late 2024 at 6.5%, vacancy in the Coeur d’Alene industrial market slightly declined to 6.3% in Q1
Industrial Rents Holding Steady
The average asking rent across the market is $10.35/SF, up just 0.3% year-over-year—a clear sign that the market is cooling after years of above-average rent growth.
By property type:
- Flex space: $11.38/SF
- Logistics: $10.26/SF
- Specialized industrial: $9.85/SF
The five-year average annual rent growth remains strong at 4.4%, but near-term growth may stay flat as leasing activity softens and more space remains on the market.
New Construction Slows Significantly
Only 42,000 SF is currently under construction across two small projects:
- 4129 E Early Dawn Ave in Hayden/Dalton Gardens – 36,000 SF
- New building in Post Falls – 6,000 SF (100% pre-leased)
This is far below the 10-year average of 250,000 SF under construction. Builders are taking a cautious, demand-driven approach as availability rises and leasing velocity slows.
Industrial Sales Activity and Pricing
Sales volume totaled $6.6 million over the past 12 months—below the five-year average of $8.0 million. The average price per square foot is $109, with a market cap rate of 8.6%, which is above the national average of 7.3%.
Notable 2024–2025 Sales:
- 11258 N Warren St: 8,325 SF sold for $3.76M ($452/SF)
- 11521 N Warren St: 9,819 SF sold for $1.79M ($182/SF)
- 4839 W Industrial Loop: 6,560 SF sold for $550K ($84/SF)
Sales were dominated by smaller, fully occupied buildings with below-market cap rates. Investors appear to be favoring low-risk, long-term leased assets in strategic locations like Hayden and Post Falls.
Submarket Highlights
| Submarket | Vacancy | Rent/SF | Under Construction | Net Absorption |
|---|---|---|---|---|
| Post Falls | 12.0% | $10.70 | 6,000 SF | 89,161 SF |
| Hayden/Dalton Gardens | 1.3% | $10.27 | 36,000 SF | 33,010 SF |
| Greater Coeur d’Alene | 3.3% | $9.68 | 0 SF | 33,378 SF |
| Coeur d’Alene CBD | 3.7% | $10.80 | 0 SF | -10,000 SF |
| Kootenai | 5.4% | $10.68 | 0 SF | -9,495 SF |
Economic and Demographic Trends
Coeur d’Alene continues to benefit from strong in-migration, especially from California and Western Washington. However, housing costs and inflationary pressures are reshaping business location strategies.
Key highlights:
- Population: 190,000+ (projected growth of 1.9% YoY)
- Median household income: $81,090 (above national average)
- Industrial job growth is modest, led by construction and logistics
- Government and healthcare remain the region’s top employment sectors
With nearly 30% of the workforce in government, healthcare, and hospitality, the region remains service-oriented but increasingly attractive for regional logistics.
Outlook for Coeur d’Alene Industrial Real Estate
The Coeur d’Alene industrial real estate market is likely past its peak in vacancy, with leasing and absorption beginning to stabilize. With limited speculative construction and a low volume of large block space coming online, vacancy could decline gradually through late 2025.
What to Watch:
- Absorption in Post Falls and Hayden
- Owner-user and small investor interest in flex and logistics assets
- Stabilization of rental rates across flex and specialized buildings
- Repricing opportunities as cap rates rise and values reset
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📩 Need help with leasing, selling, or evaluating an industrial asset in North Idaho?
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Email Eric Peterson at [email protected] or call (509) 509-903-9077 to start a conversation.
