There’s a realignment of warehouse properties. This is what it is best to take note of

In a large industrial warehouse, rows of shelves are stacked with packages as two workers in safety gear walk around and inspect the warehouse. The space used represents efficiency and systematic inventory management.

Witthaya Prasongsin | moment | Getty Images

A version of this article first appeared in the CNBC Property Play newsletter with Diana Olick. Property Play covers new and evolving opportunities for real estate investors, from individuals to venture capitalists, private equity funds, family offices, institutional investors and large public companies. Sign up to receive future issues straight to your inbox.

After a pandemic-related surge and subsequent decline, supply and demand for warehouse properties are finally beginning to balance and are showing new signs of life.

E-commerce, which was the main driver of the recent boom cycle, has certainly not disappeared, but more and more people are returning to brick-and-mortar retail. Warehouse tenants today value efficiency, performance and location more than square footage.

New developments have slowed and federal policy is pushing production offshore, helping the sector combat still-high interest rates and economic uncertainty. Rent increases are no longer as strong as they were a few years ago, and in some markets they are even declining slightly due to oversupply.

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“Commercial real estate rents are showing signs of stabilizing, indicating a more balanced market environment,” said Judy Guarino, managing director of commercial mortgage lending at JPMorgan Chasein a note to investors.

Here’s what to look for in warehouses in 2026.

Big box

The big box subsector refers to large, modern distribution and warehousing facilities that serve as hubs for logistics, warehousing and e-commerce fulfillment. It accounts for about a quarter of all industrial warehouse space in the United States

According to industry data, vacancies are close to economic highs and new construction is declining. In the first half of this year, new supply still exceeded new demand, but the gap was shrinking, according to new research from Colliers. Third-party logistics companies, including delivery services like Ryder and DHL that transport goods on behalf of a customer, are leading the way in this demand.

“Demand in the third quarter far exceeded that of the entire first half, which is another really strong indicator that supply and demand are starting to balance more,” said Stephanie Rodriguez, national director of industrial services at Colliers.

According to Colliers, the overall vacancy rate in the top 20 markets rose 19 basis points to 11% in the first half of the year. New supply totaled 48 million square feet in the first half of 2025, significantly less than the 330 million square feet completed at the peak of the cycle in 2023. Rents are expected to stabilize in the near future before starting to rise again.

Big boxes are an important segment of the overall warehouse real estate market, driven particularly by demand from online retailers and companies seeking efficient supply chain operations. Recent economic and tariff policies have definitely shaken this demand, but if these policies stabilize, demand could rise again. Lower interest rates would be another driver.

Supply chain

The supply chain, which relies heavily on warehouse real estate, is also experiencing some kind of change that could increase demand. In a report titled “Bold Predictions for 2026,” Prologis, the world’s largest logistics real estate company, identifies specific supply chain trends to watch, including predictions that:

1. E-commerce companies will account for nearly 25% of new rentals next year as the share of goods sold online rises to nearly 20% globally by year-end.
2. The need for power-ready logistics facilities that can support automation and manufacturing will be one of the top three factors in location selection worldwide.
3. Defense-related demand in the U.S. and Europe will breathe new life into older industrial corridors and spawn a new class of specialized logistics facilities.
4. Shrinking trucking capacity will lead to double-digit tariff increases in 2026, making transportation an even larger share of total supply chain spending and increasing the value of well-located logistics real estate.

Performance

Energy is becoming a leading driver for all real estate portfolios. Beyond the usual narrative of the e-commerce and data center sectors, power availability and network densification are becoming key pricing catalysts, according to a recent report from Hines, a global real estate investment manager.

“While demand for re-/near-shoring continues to grow, albeit slowly and with somewhat uneven impact, opportunities also lie in higher-performing infill assets that support faster and denser networks; where distance once brought benefits, proximity now creates them,” the Hines report said.

Relocation

Further research from Hines shows that net absorption in warehouses correlates with construction spending in the manufacturing sector.

“This trend highlights another potential source of demand not only for industrial manufacturing facilities but also for the warehousing subsector,” says the report, which predicts that reshoring alone could increase total warehousing demand by about 35% over the next five years.

“Despite the volatility in the macroeconomic landscape caused by uncertainties surrounding interest rates and trade policy, industrial real estate near ports remains critical,” Guarino said. “Tariffs can lead to increased costs and challenges in the supply chain, but these locations are critical to maintaining supply chain resilience and adapting to trade changes.”

Vicinity

An example of the proximity advantage: Amazon. Its logistics real estate strategy reflects a broader national trend that prioritizes efficiency, automation and consumer proximity over sheer size, according to a statement from CoStar.

“It’s an interesting turning point for industrial developers and REITs that have benefited from the pandemic-era boom,” wrote Juan Arias, national director of industrial analytics at CoStar Group.

Arias highlighted a slowdown in leasing, noting that Amazon has occupied just 61 logistics properties this year, down from 100 in 2024 and even 300 in recent years. Demand for facilities with larger footprints has fallen to a seven-year low, but the company is still moving toward newer, taller buildings with an emphasis on modern, efficient distribution centers, Arias said.

AI

Artificial intelligence and real estate technology are shaping the warehousing sector like everything else. They help owners and operators analyze supply chains, traffic patterns and data more efficiently – particularly important when identifying potential warehouse locations. They also help manage inventory and predict maintenance needs, both of which reduce costs.