Planning ahead was a good thing for North American ports, as activity in 2024 surged to 61.3 million TEUs (20-foot equivalent units) across the top 15 ports, up 11.2% year-over-year and the third-busiest year on record. But warehouse vacancy rates are on the uptick, especially in emerging markets, said Savills in its 2025 “Ports Report.”
All of the 15 ports assessed saw volume gains except for Baltimore and Montreal. While 2025 looks to be a bit more stable, as labor issues have been resolved, many shippers are continuing to implement short-term strategies as they remain wary of tariff increases.
Other situations can’t be foreseen, such as the Key Bridge collapse in Baltimore in March 2024. Even though the main shipping channel for the Port of Baltimore reopened in June 2024, the port saw the TEUs decline 32.4% from the previous year. Not surprisingly, at 9.0%, Baltimore’s vacancy rate ranks third among the discussed ports (which also include Charleston, S.C.; Houston; Jacksonville, Fla.; Long Beach, Los Angeles and Oakland, Calif.; New York and New Jersey; Northwest Seaport Alliance; Savannah, Ga.; Virginia; Montreal and Vancouver, Canada and Manzanillo, Mexico.
“Tariff uncertainty continues to challenge supply chain planning and strategy, making it difficult for companies to determine whether complex/large-scale shoring initiatives or strategically diversifying suppliers is the right long-term move,” said J.C. Renshaw, head of supply chain consulting, North America of Savills, in the report. “In response, many are taking short-term steps like pulling freight forward to manage risk. With organized labor stability seemingly in place, both port markets and inland hubs will play a key role in keeping goods moving efficiently.”
Top markets Los Angeles and Long Beach saw the strongest growth, as shippers diverted cargo from East and Gulf Coast ports to avoid delays from the first strike by the International Longshoremen’s Association in nearly 50 years. Los Angeles’ volume of 10.3 TEUs last year was a 19.3% increase year-over-year, and it remains the largest U.S. gateway for Asian imports. Nearby Long Beach handled 9.6 million TEUs in 2024, a whopping 20.3% increase over 2023. But housing cargo there is pricey. And diversification is key, as the markets are the most exposed to trade from China, which accounts for more than 50% of imports at the two ports.
Despite challenges from labor and tariffs, the Port of New York and New Jersey (the third busiest in the U.S.) saw higher volumes, handling 8.7 million TEUs, up 11.4% year over year. But vacancy is rising, and with 9.8 million square feet of warehouse space under construction, occupiers may have more leverage.
Construction slowed activity at the Port of Charleston, which saw TEU volumes essentially flat from 2023 and down nearly 11% from 2022 levels. In addition to the labor negotiations, a software disruption and ongoing berth construction saw vessel wait times rise to three days, the report noted. However, investment continues, with the port recently acquiring a 280-acre former mill site that will expand the North Charleston Terminal’s capacity.
“Just two years ago, Charleston and Savannah had vacancy rates below 2%—today, they have the highest among major port hubs at 17.6% and 12.1%, respectively,” the report said. “However, recent volume gains are expected to drive a demand rebound in the coming quarters, stabilizing property market conditions. For now, expect occupiers to benefit from more favorable leasing terms and relative labor peace expected in 2025.”
Benefiting from all of this is the Port of Houston, the largest port on the Gulf Coast, which ranked fifth in 2024 in terms of trade, and saw a record 4.1 million TEUs, up 8.2% from 2023. As important, the imports are expanding beyond petroleum products, with China accounting for 34.0% of the port’s import market share. In addition, it remains among the more affordable ports for warehouse occupiers, with 14.7 million square feet of space under construction, the second largest pipeline in the U.S.
A growing port is Savannah, but it wasn’t without issues, including congestion, power outages from Hurricane Helene and a spike in warehouse vacancy from 1% in 2022 to 12% in 2024 as 40 million square feet of new space came online during those two years. But volume rose 12.5% from 2023 to 5.5 million TEUs.
The Port of Virginia, which had a vacancy rate of 4.6%, is seeing nearly five million square feet of new construction in the pipeline, 64% of which is still available. The port handled 3.5 million TEUs, up 7.2% from 2023.
Ports south and north of the U.S. also saw gains. The main point of entry for Asian-manufactured vehicles and Chinese goods coming to Canada. Vancouver, the country’s top port, saw an 11% increase in TEUs to 3.5 million, despite rail strikes and a labor lockout. The Port of Manzanillo saw a 6.1% year-over-year increase to 3.9 million TEUs. It is hampered by the lack of large warehouse space nearby, the report noted. But that could change in coming years, as the country is planning to invest $3.2 billion to expand the port and double its container capacity.
Going forward, the report said, expect shippers to continue to front-load as they anticipate trade policy volatility, with China’s percentage of business to decline. But higher container volumes should bode well for warehouse demand, stabilizing that market.
“Recent volume gains are expected to drive a demand rebound in the coming quarters, stabilizing property market conditions,” the report said. “For now, occupiers continue to benefit from more favorable leasing terms and relative labor peace expected in 2025.”
