The number of mega leases within the industrial segment fell by more than half during the first six months of the year, with only 13 leases totaling 15.6 million square feet completed compared with 31 deals totaling 34.5 million square feet a year ago. The drop off in industrial leases over 1 million square feet is likely the result of occupiers becoming more selective and less expansion-minded, according to a CBRE analysis.
The total volume of the top 100 industrial leases in the first half fell to 71.8 million square feet, down from 81.4 million square feet during the first half of 2024. At the same time, the average lease size among the top 100 deals also declined, from 814,000 square feet last year to 718,000 square feet during the first half of 2024. The report said industrial occupiers are making smaller commitments this year amid higher rents.
Renewals among the top 100 leases were down slightly. The number was 38 renewals compared with 41 during the first half of 2024.
CBRE highlighted a notable occupier shift during the first half, with third-party logistics providers dominating the top 100, taking 38 leases for a total of 28.9 million square feet. That was up from 28 leases among 3PL providers totaling 20.6 million square feet during the first half of 2024.
The report attributed this shift to a growing share of retailers and manufacturers outsourcing warehousing and distribution operations. General retail and wholesale tenants, which represented the largest share of top 100 leases during the first half of last year, dropped to second place with 28 leases totaling 12.4 million square feet this year.
Demand from e-commerce-only tenants dropped significantly, according to the report. Only seven leases among this group were signed during the first half, totaling 4.7 million square feet. This was down from 31 for 13.2 million square feet during the first half of last year.
“The drop-off reflects broader restructuring across the e-commerce sector, with many firms continuing to scale back after a period of rapid growth,” said CBRE.
The Inland Empire led the country with 14 leases totaling 9.8 million square feet, followed by the Pennsylvania I-78/I-81 corridor with nine leases totaling 6.3 million square feet. Dallas/Ft. Worth ranked third with seven leases totaling 5.8 million square feet. Each of these markets is a critical distribution hub supported by strong transportation access and logistics infrastructure, according to CBRE.
The report predicts muted leasing momentum this year, as higher borrowing costs, cautious corporate spending and a limited number of large active requirements reduce deal volume. If interest rates moderate and the development pipeline tightens, momentum may return in 2026, CBRE noted.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.