Leasing activity for mega-logistics warehouses picked up pace in the first half of the year, though one key customer category — e-commerce — did not join the party.
Warehouse users signed leases for 37 facilities of 1 million square feet or larger through June, up from 24 facilities during the first half of 2021, according to data from real estate services giant CBRE Group Inc. (NYSE: CBRE).
Appetite for big-box spaces continued strong, with the average size of the top 100 warehouse leases reaching 931,860 square feet, up from 800,149 in the 2021 period, per CBRE data. Of the top 100 leases, 85 were new contracts rather than renewals, a barometer of broadening expansion, CBRE said.
Atlanta was the leading market for the largest 100 leases, with leases signed for 12 facilities. It was followed by Chicago (11), Indianapolis (nine) and California’s Inland Empire and Savannah, Georgia (seven apiece), according to CBRE data.
The most striking change over the past two years was the dramatic decline in big-box facilities leased by pure e-commerce users. E-tailers signed mega-leases for just 12 facilities in the first half of 2022, CBRE said. That was compared with 32 in the first half of 2021 and 35 during the first half of 2020 when the pandemic sent e-commerce demand soaring.
The decline in first-half 2022 leasing activity was due to a pullback by large e-commerce companies, according to Kris Hudson, a CBRE spokesman.
The biggest year-over-year increase came in the general retail and wholesale category. That segment led the pack in the first half with leases of 40 mega-warehouses, compared with 32 in 2021 and 27 in 2020. Third-party logistics (3PL) providers signed leases for 30 mega-warehouses in 2022’s first half, up from 24 in 2021.
Leasing of smaller warehouses, defined as 25,000 square feet or less, declined in the first half due to the uncertain economic environment, per CBRE data. The smaller-facility category performed well in 2021 and into early 2022 as developers and users experienced trouble procuring large parcels of land to erect big-box buildings.
