In an increasingly interconnected global economy, businesses face growing complexity in supply chain management. From raw material procurement to product delivery, each step presents uncertainties. Against this backdrop, companies must decide whether to treat logistics as a core competency requiring substantial investment or outsource to specialized third-party logistics (3PL) providers for optimized efficiency. The latest U.S. industrial real estate leasing data from the first half of 2025 offers compelling insights.
3PL Dominates Industrial Leasing Activity
CBRE's recent report reveals 3PL providers now command the industrial leasing market, outpacing retail and e-commerce companies in expansion. During the first half of 2025, 3PL firms secured 38 of the top 100 industrial leases nationwide, totaling 28.9 million square feet (MSF) — a significant increase from 28 leases during the same period last year.
This surge stems from multiple factors:
- Increased outsourcing: Companies increasingly delegate warehousing and supply chain operations to focus on core competencies while reducing operational risks.
- Supply chain complexity: Global trade expansion demands sophisticated handling of cross-border shipping, customs clearance, and inventory management — areas where 3PLs specialize.
- Technological advancements: Automation, smart logistics systems, and data analytics enhance 3PL capabilities, improving efficiency and customer satisfaction.
- E-commerce evolution: The sector's rapid growth requires precise, rapid fulfillment that 3PLs are equipped to provide.
- Labor cost pressures: Rising wages make in-house logistics less economically viable compared to 3PLs' scale advantages.
Notably, e-commerce companies dramatically reduced leasing activity, signing just seven agreements for 4.7 MSF compared to 31 leases for 13.2 MSF in 2024. This reflects a strategic shift toward outsourcing logistics to focus on product development and marketing.
Large Warehouse Demand Shifts
The report highlights declining interest in mega-warehouses exceeding 1 MSF. Only 13 such leases occurred in early 2025 (totaling 15.5 MSF), down from 31 leases (34.5 MSF) in 2024. Key reasons include:
- Heightened economic uncertainty prompting cautious expansion
- Rising rental costs making large spaces less attractive
- Improved operational efficiency reducing space requirements
- 3PLs absorbing some demand through consolidated operations
Regional Market Variations
Southern California's Inland Empire led leasing activity with 14 agreements for 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 share strategic advantages:
- Proximity to major ports (Inland Empire)
- Northeastern transportation networks (I-78/I-81)
- Centralized distribution capabilities (Dallas-Fort Worth)
Expert Analysis: The 3PL Advantage
James Breeze, CBRE's Global Head of Industrial & Retail Research, explains: "Retailers and wholesalers increasingly outsource distribution to reduce capital expenditures, gain seasonal flexibility, and focus on core business functions rather than product movement."
Breeze identifies this as a long-term trend, noting: "Distribution grows more specialized and technology-dependent, making 3PL partnerships increasingly logical — especially during periods of supply chain volatility."
Regarding large warehouses, Breeze observes that June 2025 alone saw six 1+ MSF leases, suggesting future demand will primarily come from 3PLs rather than traditional retailers.
Market Implications and Strategic Considerations
The 3PL boom reshapes industrial real estate through:
- Altered demand patterns favoring logistics specialists
- New location preferences emphasizing transportation access
- Evolving facility designs supporting flexible operations
- Intensified competition among property owners
Companies should:
- Reassess logistics strategies for potential outsourcing
- Carefully vet 3PL partners' capabilities and technologies
- Optimize supply chains through digital transformation
With global 3PL revenues projected to reach $1.4 trillion by 2028 (6.2% annual growth), this sector will continue influencing industrial real estate dynamics. However, economic downturns, technological disruptions, and regulatory changes remain potential challenges.
Looking ahead, 3PL providers must innovate through automation, data analytics, and sustainable practices to maintain growth while helping businesses navigate increasingly complex supply chain landscapes.