While commercial real estate vacancies persist, the warehouse boom is still going strong.

A CBRE analysis found that from January through May, first-year base rents on leases of a year or more rose by 9.7 percent year-over-year, CNBC reported. Large warehouses have seen even sharper rent growth — 13.2 percent for leases of 500,000 square feet or more and 11.6 percent for those between 100,000 and 499,999.

Nearly 100 million square feet of commercial space was absorbed in the industrial and logistics market in the first quarter, the publication added. Additionally, 376 million square feet of warehouse space is under construction.

Asking rents in the first quarter increased by 7.1 percent from a year prior to a record of $8.44 per square foot. The average base rent for industrial properties along the coast has soared even higher. From last May, in Northern New Jersey it rose 33 percent, as well as 24 percent in the Inland Empire of California and 20 percent in Philadelphia.

E-commerce is driving the boom. Amazon is powering the trend, but it is hardly alone. Grocery delivery companies such as Instacart are among those pushing to add more fulfillment centers to speed up deliveries for consumers who are not going to grocery stores like they once did.

ElmTree, a private equity firm in commercial real estate, is one company looking to take advantage. It has acquired almost $2 billion in industrial space in just the past seven months. Its CEO predicts the United States will need 135 million to 150 million more industrial square feet annually.

ShipBob, a company providing fulfillment services for online retailers, has doubled its number of warehouses from a year ago to 24, with hopes of reaching 35 by the end of 2021. The company’s valuation is over $1 billion.

Amazon is one of the nation’s leaders in industrial space, occupying 22 million square feet from industrial space powerhouse Prologis alone.

[CNBC] — Holden Walter-Warner