Louisville Commercial Real Estate Market Report: Q4 2025 Data

October 3, 2026 at 4:00 AM

by Rob Bergeron

Louisville Commercial Real Estate Market Report: Q4 2025 Data

This edition covers fourth-quarter 2025 (October–December) market data, compiled and published by Winner Commercial in October 2026 as part of our quarterly report archive.

Every figure below comes from a research report published for that quarter or for year-end 2025. When a number wasn't published, we say so instead of filling the gap. For the most current numbers, see the Q3 2026 edition.

Market snapshot: Q4 2025

Industrial tenants absorbed 2.6 million square feet in Q4, pushing full-year 2025 absorption to 3.9 million and vacancy down to 3.7%, per Cushman & Wakefield | Commercial Kentucky.
Industrial net asking rent reached $6.55 per square foot, up from $6.25 in Q3 and $5.93 at year-end 2024.
Office vacancy improved to 18.8% from 19.2%, with positive absorption downtown and in the suburbs, helped by Yum! Brands' 74,667-square-foot lease at PNC Tower.
Apartment rents ended the year at $1,212 a month, up 0.6% year over year, with occupancy at 93.1%, per MMG Real Estate Advisors.
Industrial completions totaled 4.0 million square feet in 2025, up from 2.4 million in 2024.

Industrial

Q4 2025 was the strongest industrial quarter of the year. Cushman & Wakefield | Commercial Kentucky's Q4 2025 Industrial MarketBeat reported overall vacancy of 3.7%, down 20 basis points from 3.9% in Q3. (A basis point is one-hundredth of a percentage point.) Net absorption, the change in occupied space (move-ins minus move-outs), was 2.6 million square feet for the quarter and 3.9 million for the year. Leasing hit 3.0 million square feet in Q4 and 7.3 million for 2025.

Big-box (bulk) buildings drove the turnaround. Bulk buildings absorbed 2.5 million square feet in Q4 on 2.6 million square feet of bulk leasing, and bulk vacancy fell to 6.0% from 6.4%. Bulk asking rent rose to $6.89 per square foot. Of 2025's completions, 83% were speculative (built without a signed tenant) and 17% build-to-suit (built for a committed tenant). Bulk space under construction stood at 6.3 million square feet, with another 7.6 million planned. Largest deals:

Kenco: 664,800-square-foot renewal at 201 River Ridge Parkway, Southern Indiana.
DQS: 519,000-square-foot new lease at 6001 Cane Run Road, West/Southwest.
Bedabox, LLC: 406,640-square-foot new lease at 7865 National Turnpike, South.
Meta: 352,800-square-foot new lease at 2825 Transglobal Drive, South.
Foxconn: 350,000-square-foot new lease at 6675 Randy Coe Lane, West/Southwest.

By submarket at year-end: the East at 1.1% vacancy ($6.94 asking rent), the South at 2.1% ($6.68), West/Southwest at 2.7% ($6.82), Bullitt County at 5.5% ($6.66) with 2.2 million square feet under construction, and Southern Indiana at 8.1% ($6.99) after 2.7 million square feet of 2025 completions. The report expected vacancy to trend slightly upward near term given the bulk pipeline, and 2026 absorption to outpace 2025. Those were forecasts, not results. See our Louisville industrial corridors guide.

Office

Cushman & Wakefield | Commercial Kentucky's Q4 2025 Office MarketBeat put overall vacancy at 18.8%, down from 19.2% in Q3, and overall asking rent at $18.95 per square foot. Both downtown and the suburbs posted positive absorption for the quarter, though the full year was still negative at -431,015 square feet.

Central business district (CBD): 21.9% vacancy, Q4 net absorption of +65,274 square feet (-17,130 for the year), overall asking rent of $17.82, Class A $20.00. Class A vacancy was 26.9% and Class B 18.1%. Leasing totaled 411,600 square feet for 2025.
Suburban: 16.4% vacancy, down 30 basis points, Q4 net absorption of +56,280 square feet (-413,885 for the year), overall asking rent of $19.94, Class A $21.06. Leasing totaled 259,314 square feet for 2025.
By building class: Class A 22.5% vacant at $20.65; Class B 16.3% at $16.73; Class C 1.4% at $14.24.

The headline deal was Yum! Brands' 74,667-square-foot lease at PNC Tower downtown, which the report called "a massive endorsement" of downtown. PNC also renewed 78,000 square feet at 101 South Fifth Street. In the suburbs, Actalent Services leased 12,300 square feet in Hurstbourne/Eastpoint and Homecare Homebase renewed 13,485 square feet in the Northeast. Under construction: 19,266 square feet downtown and 101,200 in the suburbs.

A narrower measure told a harsher story. A November 2025 CBRE report on downtown office towers, covered by WDRB and Louisville Business First, found more than 1.8 million square feet vacant and a vacancy rate above 40%, up from 35% a year earlier, and noted that the figures don't count tenants who have announced moves but not yet left. That tower-only rate is not comparable to Cushman & Wakefield's CBD rate, which covers a broader building set. More detail is in our Louisville office corridors guide.

Retail

Cushman & Wakefield's Q4 2025 Louisville retail MarketBeat is a narrative report with no vacancy or rent table, and we found no other publicly accessible Q4 2025 Louisville retail report with a measured vacancy rate. So this edition does not print a Q4 retail vacancy rate. What was published:

Prime retail rents in the $30 to $40 per square foot range, with new construction testing $50.
Publix advancing two ground-up stores (Flat Rock Road, and Brownsboro Road at Chamberlain Lane) plus a proposed infill at Mid City Mall in the Highlands.
Restaurant openings and announcements including Shake Shack (Jeffersonville Town Center and Oxmoor Mall), Zaxby's on Central Avenue near Churchill Downs, Chick-fil-A on Brownsboro Road and Chipotle on U.S. 42 at Holiday Manor in a former KFC.
NuLu Crossing, planned with 35,000 square feet of retail, 30,000 square feet of Class A office, 525 residential units and a 587-space garage.

Looking back on the year, Marcus & Millichap's 1Q 2026 Louisville retail forecast counted about 10 large-format leases over 20,000 square feet signed in 2025 and said the market entered 2026 with vacancy still among the lowest in the nation.

Commercial multifamily (apartment buildings)

MMG Real Estate Advisors' 2026 Louisville Forecast, which reports year-end 2025 results, put average effective rent (what renters pay after concessions such as a free month) at $1,212 a month, up 0.6% year over year. Occupancy was 93.1%. For the full year:

2,339 units completed, close to the 10-year average of 2,325.
2,072 units of net absorption, above the 10-year average of 1,984.
2,670 units started, up 30% from 2024, with 3,914 units under construction at year-end.

MMG's 2026 forecast called for rent of $1,227 and occupancy of 92.9% by Q4 2026, on 2,494 completions and 1,380 units of absorption. Those are projections, not results. Cushman & Wakefield | Commercial Kentucky did not publish a separate Louisville multifamily report for Q4 2025 that we could find; its Q3 2025 and Q1 2026 reports bracket the quarter.

Investment sales and cap rates

A capitalization rate (cap rate) is a property's net operating income (NOI) divided by its price. None of the Q4 2025 Louisville reports we could access published a quarter-specific cap rate, so we are not citing one. Reported transactions:

Industrial: Ares Capital Management bought 150 Omicron Court in Bullitt County (399,600 square feet), and Lightstone Group bought 6901 Riverport Drive in West/Southwest (337,165 square feet). Prices were not disclosed in the report.
Apartments: a separate Q4 sales count was not published. Cushman & Wakefield | Commercial Kentucky reported 1,880 units sold through Q3 2025.

What changed from the prior quarter (Q3 2025 to Q4 2025)

Industrial vacancy: 3.9% to 3.7%. Net asking rent: $6.25 to $6.55. Year-to-date absorption: about 847,000 square feet to 3.9 million, including 2.6 million in Q4. (Cushman & Wakefield)
Bulk industrial vacancy: 6.4% to 6.0%. Bulk asking rent: $6.56 to $6.89. Bulk net absorption: -165,819 to +2.5 million square feet.
Office (Cushman & Wakefield): overall vacancy 19.2% to 18.8%; CBD 22.4% to 21.9%; suburban 16.7% to 16.4%; asking rent $18.92 to $18.95.
Office net absorption: CBD -2,929 to +65,274 square feet; suburban -17,366 to +56,280.
Apartments (MMG): Q3 figures were not accessible to us; year-end rent of $1,212 compares with $1,221 in Q2, and occupancy of 93.1% matched Q2.

What it meant for owners, buyers, and tenants

Industrial owners closed the year in a strong position: 2.6 million square feet absorbed in one quarter, overall vacancy back to 3.7% and rents up about 10% from year-end 2024 ($5.93 to $6.55). Tenants needing big blocks still had the most choice in Southern Indiana, where vacancy was 8.1% after heavy new supply.

Office showed its first positive quarter of the year, but full-year absorption was still deeply negative, and older downtown towers carried most of the risk. Suburban Class A rents stayed above $21.

Apartment owners saw rents essentially flat for the year as roughly 2,300 new units landed, so buyers needed to underwrite off in-place rents and actual concessions. Run the math with our commercial calculators, or request a free commercial property valuation.

Other editions in this archive

This archive is named by data quarter and covers Q2 2024 through Q1 2026. The newest numbers are in the Q3 2026 Louisville commercial real estate market report, and our Louisville commercial real estate hub links everything in one place. Other archive editions:

Talk to Winner Commercial

Winner Commercial works alongside Winner Realty. Rob Bergeron, Owner–Realtor (KY license #219325), has closed 2,000+ residential and commercial transactions since 2013, and our commercial track record lists 45 closed commercial deals. Sellers can also put a property in front of the 70,000+ buyers on OffMarket.deals. If you're weighing a sale, a purchase or a 1031 exchange, send us the property or call (502) 305-8915.

FAQ

What was Louisville's industrial vacancy rate in Q4 2025?

3.7%, down from 3.9% in Q3 2025, per Cushman & Wakefield | Commercial Kentucky. Net absorption was 2.6 million square feet in Q4 and 3.9 million for the year.

What was Louisville's office vacancy rate at the end of 2025?

18.8% overall per Cushman & Wakefield | Commercial Kentucky, with 21.9% downtown and 16.4% in the suburbs. A separate CBRE study of downtown office towers alone put that subset above 40%.

What was the average apartment rent in Louisville at the end of 2025?

$1,212 a month in average effective rent, up 0.6% year over year, with 93.1% occupancy, per MMG Real Estate Advisors.

What was Louisville's retail vacancy rate in Q4 2025?

No Q4 2025 Louisville retail vacancy rate was published in the reports we could access. Marcus & Millichap said the market entered 2026 with vacancy among the lowest in the nation, and Cushman & Wakefield put prime rents at $30 to $40 per square foot.

Is this the most recent Louisville market report?

No. This is an archive edition covering October–December 2025 data. The newest edition is the Q3 2026 report.

Sources

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