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The most in-demand product type in industrial real estate has a vacancy rate under 4% – and most institutional developers are still ignoring it. While the industry spent the last decade racing to build bigger, a quieter story was playing out in the 15,000-30,000-square-foot range. Small bay industrial – shallow-depth, grade-level buildings designed for manufacturers, fabricators, trade contractors and small business operators – never stopped leasing. It just stopped being built.

Now the gap between supply and demand is wider than it’s been in a generation. Reshoring is adding fuel to an already tight market, and the tenant pool is enormous: 98% of U.S. manufacturing companies are classified as small businesses. The developers who move on this opportunity now will position themselves for a demand wave the market is structurally unprepared to meet.

Method Architecture has been designing this product for years across the U.S. This article breaks down who’s filling these buildings, what the specs actually look like when a project leases fast, and why small buildings are industrial’s biggest story right now.