Business
The warehouse real estate sector is seeing a rebalance. Here’s what to watch for
A large industrial warehouse features rows of shelves stacked with packages, while two workers in safety gear are walking and inspecting the storage. Utilized space exemplifies 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 the real estate investor, from individuals to venture capitalists, private equity funds, family offices, institutional investors and large public companies. Sign up to receive future editions, straight to your inbox.
After a pandemic-driven surge, and a subsequent pullback, warehouse real estate supply and demand is finally starting to come into balance and showing new signs of life.
E-commerce, which was the primary driver of the recent boom cycle, certainly hasn’t gone away, but more people are returning to brick and mortar. Warehouse tenants are now more focused on efficiency, power and location than they are on square footage.
New development has slowed down, and federal policies are pushing onshoring of manufacturing, which helps the sector counter still-high interest rates and economic uncertainty. Rent increases are no longer as steep as they were a few years ago, and in some markets they are actually falling slightly due to oversupply.
“Industrial property rents are showing signs of stabilization, indicating a more balanced market environment,” said Judy Guarino, managing director of commercial mortgage lending at JPMorgan Chase, in a note to investors.
Here’s what to watch for in warehouses in 2026.
Big-box
The big-box subsector refers to large, modern distribution and warehouse facilities that serve as hubs for logistics, storage and e-commerce fulfillment. It makes up about a quarter of the total industrial warehouse space in the U.S.
Vacancies are close to cyclical peaks and new construction is contracting, according to industry data. In the first half of this year, new supply still outpaced new demand, but the gap shrank, according to new research from Colliers. Third-party logistics firms, including delivery services such as Ryder and DHL moving goods on behalf of a client, are leading that demand.
“The third-quarter demand has far exceeded the entire first half of the year, which is another really strong indicator that the supply and demand is starting to get more into a balanced state,” said Stephanie Rodriguez, national director of industrial services at Colliers.
Across the 20 largest markets, the overall big-box vacancy rate rose 19 basis points to 11% during the first half of the year, according to Colliers. New supply totaled 48 million square feet in the first half of 2025, much less than the 330 million square feet completed at the height of the cycle in 2023. Rents are expected to stabilize in the near term before starting to grow again.
Big-box is a major segment of the overall warehouse real estate market, particularly driven by demand from online retailers and companies seeking efficient supply chain operations. Recent economic and tariff policies have definitely shaken that demand, but as those policies settle, more demand could return. Lower interest rates would be another driver.
Supply chain
Supply chain, which relies heavily on warehouse real estate, is also seeing something of a transformation that could increase demand. In a report titled “Bold Predictions for 2026,” Prologis, the world’s largest logistics real estate company, cited specific supply chain trends to watch, including forecasts that:
- E-commerce companies will make up nearly 25% of new leasing next year as the proportion of goods sold online rises to almost 20% globally by year-end.
- The need for power-ready logistics facilities capable of supporting automation and manufacturing will be a top-three factor globally in location selection.
- Defense-related demand in the U.S. and Europe will breathe new life into older industrial corridors and produce a new class of specialized logistics assets.
- Shrinking trucking capacity will drive double-digit rate hikes in 2026, making transportation an even larger share of total supply chain spend and amplifying the value of well-located logistics real estate.
Power
Power is emerging as a leading driver across real estate portfolios. Beyond the usual narrative of e-commerce and the data center sector, power availability and network densification are becoming important pricing catalysts, according to a recent report from Hines, a global real estate investment manager.
“While re/near-shoring demand continues to pick up speed, albeit slowly and with somewhat uneven impact, opportunity also lies in power-advantaged infill assets that support faster and denser networks; where distance once drove advantage, closeness now creates it,” according to the Hines report.
Reshoring
Further research from Hines shows that warehouse net absorption has correlated to manufacturing construction spend.
“This trend highlights another potential source of demand not only for industrial manufacturing facilities, but for the warehouse subsector as well,” according to its report, which predicts reshoring alone could increase overall warehouse demand over the next five years by roughly 35%.
“Despite the volatility in the macroeconomic landscape, driven by interest rate and trade policy uncertainties, industrial properties near ports remain vital,” Guarino said. “Tariffs may lead to higher costs and supply chain challenges, but these locations are key to maintaining supply chain resilience and adapting to trade shifts.”
Proximity
One example of the proximity advantage: Amazon. Its logistics real estate strategy mirrors a broader national trend, prioritizing efficiency, automation and consumer proximity over sheer scale, according to a note from CoStar.
“It’s an interesting inflection point for industrial developers and REITs that rode the pandemic-era boom,” wrote Juan Arias, CoStar Group’s national director of industrial analytics.
Arias highlighted a leasing slowdown, noting that this year Amazon has occupied just 61 logistics properties, down from 100 in 2024 and as many as 300 in recent years. Its demand for larger footprint facilities hit a seven-year low, but it is still drawn to newer, taller buildings, with an emphasis on modern, efficient distribution centers, Arias said.
AI
As with everything else, artificial intelligence and property technology are making an imprint on the warehouse sector as well. They are helping owners and operators to analyze supply chains, traffic patterns and data more efficiently — particularly important in identifying potential warehouse locations. They are also helping to manage inventory and predict maintenance needs, both of which reduce costs.
Business
Middle East heat may ripple across India’s energy supply chain, flags Goldman Sachs – The Times of India
As tensions continue to heat up in the Middle East, concerns are raising about disruptions to one of the world’s most critical energy shipping routes, the Strait of Hormuz. Any disruption could significantly affect major oil-importing countries such as India, as the narrow Strait of Hormuz is central to global energy trade. The strait sees almost 20 million barrels of oil passing through each day, or about a fifth of the world’s consumption, pass through the route. The waterway also carries roughly 19% of global liquefied natural gas (LNG) shipments, making it a crucial corridor for energy-importing economies.A recent report by Goldman Sachs has flagged early signs of stress in the region. The report warned that tanker traffic through the Strait of Hormuz has already begun showing signs of disruption, with shipping firms, oil producers and insurers adopting a cautious approach following reports of damaged vessels in nearby waters.According to the firm, financial markets have already begun factoring in the geopolitical risk. Oil prices currently carry an estimated risk premium of $18-per-barrel, reflecting the potential market impact if energy flows through the Strait of Hormuz were disrupted for about a month.
Even is the oil facilities are not directly damaged, a shutdown of the shipping route could expose a significant portion of global supply. The report estimates that in an event of full closure, about 16 million barrels per day of oil flows could be affected, despite the availability of some pipeline routes designed to bypass the strait.And the risks are not limited to crude oil shipments with almost 80 million tonnes of LNG exports annually, much of it from Qatar, moving through the passage. Any prolonged disruption could tighten gas supply globally and potentially drive European benchmark gas prices back to levels seen during the 2022 energy crisis.
Asian economies stand among the most exposed to such disruptions. Major importers such as China, India, Japan and South Korea depend heavily on oil and LNG shipments that transit through the strategic corridor.While global oil inventories and spare production capacity could help cushion short-term shocks, the report warned that sustained disruption to Gulf shipping routes could trigger sharp volatility in global energy markets and push prices higher across oil, gas and refined fuel products.Market participants and governments are closely watching tanker traffic in the Strait of Hormuz, along with diplomatic and military developments involving the United States, Iran and Gulf nations, to assess whether the current disruptions remain temporary or escalate into a broader energy supply shock.
KARACHI: The Pakistan Stock Exchange rallied on Thursday after Saudi Arabia assured Pakistan of facilitating crude oil shipments through the Red Sea port of Yanbu Port, easing concerns over potential fuel supply disruptions.
The benchmark KSE-100 Index climbed sharply during the trading session, rising 4,439.93 points (2.85%) to reach an intraday high of 160,217.14 points.
Market Recovery
Analysts attributed the market rebound to renewed institutional buying and improving investor sentiment after Saudi assurances on oil supplies.
Market expert Ahsan Mehanti, CEO of Arif Habib Commodities, said easing fuel supply concerns played a key role in the recovery.
He added that rising global crude prices, expectations of a new International Monetary Fund loan tranche for Pakistan, and positive economic indicators also boosted investor confidence.
Alternative Oil Route
Pakistan sought an alternative supply route after Iran announced the closure of the Strait of Hormuz, a crucial global oil transit corridor.
Federal Petroleum Minister Ali Pervaiz Malik held talks with Nawaf bin Said Al-Malki, requesting Saudi support for uninterrupted energy supplies.
Saudi authorities reportedly assured Pakistan that oil shipments could be routed through Yanbu, and one crude vessel has already been prepared for dispatch.
Global Oil Market Impact
Oil prices continued to rise amid tensions in the Middle East conflict involving Iran, Israel and the United States.
Brent crude: up 3.26% to $83.99 per barrel
West Texas Intermediate (WTI): up 3.70% to $77.42 per barrel
Energy markets remain volatile as shipping disruptions threaten supply through the Strait of Hormuz, a route that handles nearly 20% of global oil trade.
Analysts say the Saudi assurance helped calm fears about Pakistan’s energy supply chain, contributing to the strong recovery at the PSX.
Business
Asian stocks today: Markets inch higher mirroring Wall Street gains; Kospi jumps 10%, Nikkei up 1,400 points – The Times of India
Asian stocks inched higher on Thursday, after days of trading in red amid ongoing Middle East tensions. This comes as equities were lifted by a rebound on Wall Street as oil prices paused their recent spike and economic updates painted a more positive picture of the American economy. In South Korea, Kospi hit a pause on its downward rally to add a whopping 10% or 513 points, to reach 5,606. Japan’s Nikkei 225 also climbed 2.7% to 55,713. Hong Kong’s HSI also traded in green, rising 353 points to 25,603 as of 9:10 am. Shanghai and Shenzhen added 0.9% and 1.7% respectively. Gains elsewhere in the region were more modest. Australia’s S&P/ASX 200 added 0.3% to 8,927.20, while New Zealand’s benchmark index moved 0.9% higher. In contrast, US futures indicated a subdued start ahead. Futures linked to the Dow Jones Industrial Average were almost unchanged, while S&P 500 futures ticked up 0.2%. The S&P 500 advanced 0.8% on Wednesday, clawing back much of the decline seen since the onset of the Iran conflict. The Dow Jones Industrial Average rose 0.5%, and the Nasdaq Composite outperformed with a 1.3% gain. Globally, market sentiment has remained sensitive to developments in the Middle East, with oil price swings continuing to steer trading direction. Crude prices eased during Wednesday’s session. Brent crude briefly moved above $84 a barrel before settling at $81.40, roughly matching the previous day’s level. US benchmark crude edged up 0.1% to finish at $74.66 per barrel. By early Thursday, however, oil was on the rise again. Brent crude climbed 2.4% to $83.32 per barrel, while U.S. benchmark crude jumped 2.5% to $76.53 per barrel.
Middle East heat may ripple across India’s energy supply chain, flags Goldman Sachs – The Times of India
Princess Beatrice ‘marital woes’: Edoardo issues surprise update
LaLiga side Celta Vigo put out plea to Madonna to find 1990 jersey
India Us Trade Deal: Fresh look at India-US trade deal? May be ‘rebalanced’ if circumstances change, says Piyush Goyal – The Times of India
Attock Cement’s acquisition approved | The Express Tribune
What are Iran’s ballistic missile capabilities?
-
Business6 days ago
India Us Trade Deal: Fresh look at India-US trade deal? May be ‘rebalanced’ if circumstances change, says Piyush Goyal – The Times of India
-
Politics1 week agoWhat are Iran’s ballistic missile capabilities?
-
Business7 days ago
Attock Cement’s acquisition approved | The Express Tribune
-
Business1 week agoHouseholds set for lower energy bills amid price cap shake-up
-
Politics1 week agoUS arrests ex-Air Force pilot for ‘training’ Chinese military
-
Fashion7 days agoPolicy easing drives Argentina’s garment import surge in 2025
-
Sports6 days agoLPGA legend shares her feelings about US women’s Olympic wins: ‘Gets me really emotional’
-
Fashion6 days agoTexwin Spinning showcasing premium cotton yarn range at VIATT 2026