Shallow bay industrial
Powering Small Businesses in America
Strategically located multi-tenant industrial buildings near urban centers are essential for key functions such as light manufacturing, business and consumer services, last-mile delivery, storage, and distribution.
Shallow Bay: Defined
20K–150K SF
Building size(1)
5K–35K SF
Typical unit size
10–50
Tenants per property
20–30% / 70–80%
Office / warehouse
(1) Speed Bay’s target property size is 100K–250K SF.
Why Shallow Bay
Structural Fundamentals Support Shallow Bay Performance
~44%
of U.S. industrial inventory is shallow bay
More than 11 billion square feet nationwide, the largest segment of U.S. industrial real estate.
Total U.S. industrial inventory: 26 billion square feet.
- Shallow bay11.4B SF · 44%
- Mid bay5.2B SF · 20%
- Large bay9.2B SF · 36%
~8%
inventory growth since 2010
Infill locations, high replacement costs and difficult development economics keep new construction in check.
- Shallow bay ~8%
- Mid bay ~24%
- Large bay ~46%
Lower vacancy
than larger industrial formats across cycles
Constrained supply and steady local demand have consistently supported occupancy and rent growth.
Annual vacancy rates, 2006–2025. Shallow bay is the solid line, mid bay the dashed line, and large bay the dotted line. Full values follow in a table.
- Shallow bay
- Mid bay
- Large bay
| Year | Shallow bay | Mid bay | Large bay |
|---|---|---|---|
| 2006 | 6.2% | 6.6% | 6.6% |
| 2007 | 6.6% | 7.6% | 7.4% |
| 2008 | 6.8% | 8.1% | 8.4% |
| 2009 | 8.3% | 9.5% | 9.7% |
| 2010 | 8.1% | 9.2% | 9.0% |
| 2011 | 7.6% | 8.5% | 8.0% |
| 2012 | 7.0% | 7.6% | 7.6% |
| 2013 | 6.3% | 6.8% | 7.0% |
| 2014 | 5.5% | 6.0% | 6.4% |
| 2015 | 4.8% | 5.4% | 5.8% |
| 2016 | 4.1% | 4.9% | 5.3% |
| 2017 | 3.9% | 4.5% | 5.0% |
| 2018 | 3.5% | 4.4% | 5.0% |
| 2019 | 3.7% | 4.9% | 5.2% |
| 2020 | 4.1% | 5.4% | 5.6% |
| 2021 | 3.3% | 4.2% | 4.4% |
| 2022 | 2.8% | 3.8% | 3.9% |
| 2023 | 3.4% | 5.2% | 5.8% |
| 2024 | 4.2% | 7.0% | 7.6% |
| 2025 | 5.1% | 8.1% | 8.2% |
38%
higher average rent vs. mid-bay and large-bay
~1/3 of rent roll expires annuallyShorter lease terms create recurring mark-to-market opportunities.
Annual asking rents, 2019–2025, in dollars per square foot. Within each year, bars run left to right: Large bay, Mid bay, Shallow bay. Full values follow in a table.
- Large bay
- Mid bay
- Shallow bay
| Year | Large bay | Mid bay | Shallow bay |
|---|---|---|---|
| 2019 | $4.20 | $4.90 | $6.60 |
| 2020 | $4.40 | $5.20 | $7.00 |
| 2021 | $4.60 | $5.80 | $7.50 |
| 2022 | $5.10 | $6.50 | $8.70 |
| 2023 | $6.30 | $7.80 | $10.00 |
| 2024 | $6.60 | $8.00 | $10.30 |
| 2025 | $6.50 | $8.00 | $10.20 |
10–50
tenants per property across industries
Versus big-box industrial, where ~70% of tenancy sits in two categories.
Shallow bay shares, in left-to-right segment order: 24.3%, 15.3%, 9.9%, 9.2%, 7.8%, 6.7%, 6.1%, 5.5%, 15.2%. The reference does not identify which industry corresponds to each share.
Big box shares, in left-to-right segment order: Third-party logistics, 40%; National retail / Amazon, 30%; All other, 30%.
Shallow bay tenants span construction, machinery and materials; logistics; consumer products; retail; professional services; food and beverage; health; technology and more.
Source: CoStar, as of 12/31/25.
A fragmented market
Fragmentation Creates an Institutional Opportunity
Shallow bay has historically been owned by individuals and smaller operators. A disciplined, well-capitalized platform can aggregate, institutionalize and scale.
11B+ SF
Shallow bay inventory across the U.S.
$15–50M
Typical transaction size
Fragmented
Ownership by individuals and smaller operators
Source: CoStar, as of 12/31/25. Shallow bay: 20K–149.9K SF; mid bay: 150K–299.9K SF; large bay: 300K+ SF.
Perspectives
A Conversation on Shallow Bay
Jimmy Mulvihill, Vice Chairman of Speed Bay, sits down with longtime friend and actor Andy Buckley to talk about why shallow bay industrial has become one of the most compelling corners of the market, and how Speed Bay is building the institutional platform to scale it.
Jimmy Mulvihill
Vice Chairman & Co-Founder
Andy Buckley
Actor
Video coming soon