A new report issued this week by San Francisco-based real estate investment trust company Prologis could be viewed as a two-part story, in describing the path global logistics rents took in 2025.
The report, entitled “2025: Pause Shifts to Progress as Rents Approach Inflection,” explained that while 2025 delivered new shocks to global supply chains, logistics operators adapted by focusing on long-term supply chain needs, which was reflected by rents. It noted that over the first half of 2025, rents fell 2.3%, with customers pausing leasing decision-making, awaiting clarity around economic conditions and trade policy.
But Prologis said that pattern started to change in the third quarter, with long-term planning reemerging and customers going ahead with leasing decisions amid the ongoing volatility, as evidenced by rent declines heading down to 1.4% over the second half of 2025—marking a critical transition period for occupiers, operators, investors, and developers, with 2026 planning accelerating.
“Three factors combined to drive record leasing activity in 2025 concentrated in the latter part of the year,” said Melinda McLaughlin, Head of Global Research at Prologis. “First, customers continued to grow through 2025 as both consumers and businesses continued to spend and invest. Second, structural forces in supply chains, such as growing e-commerce, new business lines and modernizing operations, required adaptions and growth in logistics real estate footprints. Finally, the combination of both a) time to process implications from rapid shifts in trade policy and b) a narrower range of potential tariff outcomes coming to light increased confidence in decision-making. Taken together, customers began to look through the noise in the second half of the year and make the network investments their businesses require for the long term.”
The report made the case that global demand has reached an inflection point, with net absorption growing to 434 million square-feet (SF) on a seasonally-adjusted basis in the second half of 2025, topping the 213 million SF recorded over the first half of the year.
When asked how that could impact market conditions early into 2026, McLaughlin noted that as of the fourth quarter 2025, net absorption exceeded new supply, reinforcing Prologis’s view that vacancy rates are at or near peak levels.
“This inflection is accompanied by growing scarcity in select size categories and locations, expected to broaden, and stabilizing rental rates in a growing number of markets,” she said. “Looking ahead, logistics users should expect fewer choices and stable-to-increasing rents through 2026 in most locations, given deliveries are poised to reach their lowest level in more than a decade.”
In terms of available supply, Prologis said it is constrained, as replacement costs are currently around 20% above market rents, in turn, driving global completions to their lowest level going back to since 2018 this year.
For logistics users who need high-quality space in 2026, McLaughlin said there should be an urgency to leasing activity, particularly if they are looking for a big box building.
“Not only will the total volume of deliveries contract, but most deliveries are concentrated in mid-size spaces between 100,000 and 300,000 square feet,” she said. “This emerging scarcity drove an increase in built-to-suit activity by some of the largest users of logistics real estate in 2025, which we expect will extend into 2026.”
