DMV Industrial Pipeline Doubles Year-Over-Year Because of Data Centers

The DMV’s industrial development pipeline has more than doubled in size in the past year, making it one of the nation’s fastest-growing industrial landscapes.

Driven by data center construction, the region’s pipeline — which includes Washington, D.C., Northern Virginia and Southern Maryland — grew from 6.2 million square feet to 13.2 million square feet year-over-year, according to a new national market report by CommercialSearch. The additions vaulted the market from 15th largest to fifth largest in the country in less than a year, per the report. Only Houston and Chicago’s industrial markets added more new space to their respective pipelines in the past 12 months. 

The DMV’s projected inventory expansion of 7 percent, in a tie with Austin, Texas, is largest among the largest 20 markets surveyed in the report. 

Nearly half of all industrial space underway in the region is data center space. Northern Virginia, Loudoun County in particular, has long been the nation’s biggest data center hub due to its proximity to the nation’s capital, ease of development and robust fiber optic and grid networks. Available land in the county trades hands for remarkable prices as a result, yet rapidly shrinking inventory and increasingly strict regulations are forcing data center development further south. More than 30 projects are in development across a 70-mile southern stretch from Loudoun’s Leesburg to the independent city of Manassas, per the report. 

“This area of Virginia also remains the world’s largest data center market by operating capacity, but how much further it can grow will depend on whether the grid can keep up because power availability is becoming as binding a constraint as land,” the report said.

Meanwhile, Southern California’s Inland Empire region — the nation’s largest warehouse market — is continuing to shrink due to pandemic-era oversupply and macroeconomic anxieties. The region’s pipeline has substantially dwindled over at least the past three years, from 19.4 million square feet under construction in early 2024, to 8.1 million square feet in late 2025, to just 6.5 million square feet by mid-March, per separate CommercialSearch reports. In early 2024, the Inland Empire’s pipeline was ranked fourth in the nation in terms of size; by early 2026, it was ranked 13th. 

Still, industrial properties in the Inland Empire are fetching eye-popping prices. In November, Bridge Logistics Properties paid $174 million for a 1.1 million-square-foot facility in Fontana. Last April, Burlington spent $257 million for a nearly 900,000-square-foot warehouse in Riverside. 

In terms of the national development pipeline, Amazon reigns supreme. The e-commerce titan owns seven of the 20 largest industrial projects cutting the ribbon this year, including a 3.5 million-square-foot facility near Denver, and a 3.4 million-square-foot property near Madison, Wis. It also claims ownership of a 2.5 million-square-foot development in Hesperia, Calif., the only Inland Empire development included on CommercialSearch’s top 20 list.

Nick Trombola can be reached at ntrombola@commercialobserver.com.