Picture a once-bustling industrial park, where logistics trucks streamed in and out around the clock, and e-commerce warehouses hummed with activity. Today, that vibrant scene has dimmed slightly, replaced by the explosive growth of third-party logistics (3PL) providers. New warehouses are springing up like mushrooms, heralding a new era in industrial real estate. This isn't science fiction—it's the dramatic transformation currently unfolding in the U.S. industrial leasing market.
3PLs Ascend: The New Kings of Industrial Leasing
For years, e-commerce growth served as the primary engine driving industrial real estate demand. However, recent CBRE research reveals a paradigm shift, with 3PL providers rapidly rewriting the market playbook.
The report shows that in the first half of 2025, 3PL providers dominated large-scale industrial leasing activity, signing 38 leases totaling 28.9 million square feet (MSF)—a significant increase from 28 leases during the same period last year. This surge reflects growing corporate preference for outsourcing warehousing and supply chain operations to achieve greater efficiency, cost reduction, and resource optimization.
3PLs aren't just expanding their physical footprint—they're gaining substantial influence over industrial real estate development strategies, investment decisions, and even government policy discussions.
Retail Steps Back, E-Commerce Plummets
While 3PLs flourish, traditional retail and wholesale sectors signed just 28 leases for 21.4 MSF—a notable decline from their previous leading position. But the most startling data point concerns e-commerce: only 7 leases totaling 4.7 MSF, compared to 31 leases for 13.2 MSF last year.
This dramatic contraction suggests e-commerce companies are fundamentally reevaluating their operational models after years of breakneck expansion. Rather than signaling decline, this may indicate industry maturation—a shift from reckless growth to sustainable, profit-focused operations emphasizing supply chain optimization and customer experience.
Mega-Warehouse Demand Cools
CBRE defines "mega-leases" as those exceeding 1 million square feet. In H1 2025, only 13 such leases occurred (15.5 MSF total), down sharply from 31 mega-leases (34.5 MSF) in H1 2024. Economic uncertainty, rising interest rates, and climbing rental rates have made companies more cautious about massive space commitments.
Regional Hotspots Emerge
Southern California's Inland Empire led leasing activity with 14 deals (9.8 MSF), followed by Pennsylvania's I-78/I-81 corridor (9 leases, 6.3 MSF) and Dallas-Fort Worth (7 leases, 5.8 MSF). These regions benefit from strategic positions within national logistics networks—the Inland Empire as a West Coast gateway, Pennsylvania's corridor connecting Northeast and Midwest markets, and DFW as a central distribution hub.
The Outsourcing Imperative
James Breeze, CBRE's Global Head of Industrial & Retail Research, explains the fundamental driver: "Retailers and wholesalers increasingly outsource distribution to reduce capital expenditures, gain seasonal flexibility, and focus on core competencies rather than product distribution."
Breeze anticipates this trend accelerating as distribution grows more technologically complex. "We expect 3PLs' market share to keep rising," he told LM. "Specialized providers simply handle distribution better, especially during supply chain disruptions."
Future Outlook: 3PLs Driving Mega-Lease Recovery
While mega-warehouse demand currently lags, Breeze predicts resurgence led by 3PLs: "June alone accounted for 6 of H1's 13 mega-leases. Future growth will concentrate on 3PLs rather than traditional retailers."
Regarding e-commerce's decline, Breeze clarifies this directly relates to 3PL growth: "As e-commerce distribution professionalizes, companies increasingly outsource to specialists with infrastructure and expertise—reducing their direct industrial space needs."
Conclusion: A Market Transformed
CBRE's findings reveal an industrial real estate market undergoing profound transformation. 3PL providers now drive demand as companies prioritize supply chain efficiency and flexibility through specialized outsourcing. This shift will reshape industrial property development, favoring features like advanced automation, flexible layouts, and superior logistics infrastructure.
For industry participants, adaptation is crucial. Developers must design spaces meeting 3PL specifications, investors should target logistics-rich regions with strong 3PL tenants, and retailers/e-commerce firms need strategic partnerships with logistics providers. In this new era, success belongs to those who recognize and respond to these structural changes.