Industrial's Tenant-Friendly Era Nears Its End

That is a different picture than the one investors were looking at a year or two ago. Then, a construction surge and a pause in demand gave users unusually strong leverage in many North American hubs.

In 2025, average rents across the U.S. and Canada were essentially flat, but the averages hid sharp differences: some southern U.S. markets posted solid rent gains, while a number of coastal and western markets—including the Inland Empire, New Jersey, Phoenix and Los Angeles—saw vacancy rise and rents come under pressure.

By late 2025 and into 2026, the report suggests, that window had already started to close as leasing activity caught up with available space in several of those markets, trimming the depth of true "distress" deals.

Rents Pointing Up Again

The report frames the current rent picture as a cooling phase, not the end of the run. Since 2020, global logistics rents are up about 36% on average, and while growth has moderated, it has not vanished. In 2025, 24 of the 135 markets tracked recorded rent declines and 15 were flat, but 61 still saw positive growth. Cushman & Wakefield describes that as a loss of momentum in mature markets such as the U.S. and Europe rather than a broad downturn.

Within the Americas, about half of markets sit in the $5 to $10 per square foot per year range, a share that is broadly unchanged from 2024, even as the region maintains a few high-rent outliers like outer-borough New York and San Jose, California, and a low-cost extreme in Memphis, where record vacancy has pushed rents down.

Looking ahead, most markets expect rents to resume climbing. Across regions, 55% of markets anticipate rent increases over the next three years, 37% expect rents to hold steady and just 8% foresee declines.

In the Americas, that figure is again 55%, underscoring how quickly local supply-demand balances are expected to tighten. In markets where new projects are still delivering, the report says that space is already contributing to "pricing pressures" rather than discounting, as owners move to reset rents into a firmer leasing backdrop.

Rising operating costs add another layer of support. Between 2024 and 2025, the Americas saw average rent costs rise 2.8%, labor costs climb 2% and business electricity prices jump 8.3%, outpacing global averages in rents and power.

Electricity remains cheaper in much of the Americas than in Europe, thanks to access to natural gas, but prices are rising, with growing demand from energy-intensive uses such as data centers putting additional strain on infrastructure. These cost trends make deep rent concessions harder to justify and encourage landlords to push for higher contractual rents where they can still fill space.

Demand Is Broader Than One Story

The anticipated shift in bargaining power does not rest only on tighter supply. It depends on a demand outlook that, while more measured than during the pandemic's online-shopping spike, remains solid and increasingly diversified. E-commerce distribution remains the primary demand driver in most markets, and the Americas are no exception; more than three-quarters of markets globally cite it as a key source of growth over the next three years. Retail distribution and general manufacturing follow closely, reflecting both continued omnichannel build-out and the longer-term trend toward reshoring and nearshoring production.

Other users are becoming more important as well. Energy-related tenants are expected to play a larger role in absorption in the Americas, supported by investment in renewables, decarbonization projects and the logistics infrastructure that underpins those supply chains.

High-tech, industrial equipment, transportation and aerospace occupiers are also flagged as meaningful contributors, particularly in U.S. markets linked to defense and advanced manufacturing hubs. With several sectors pulling on space at different times and in different ways, the market is less exposed to a single-source demand shock.

The report acknowledges some headwinds that could affect timing. Potential changes to U.S. tariffs and broader geopolitical events—including conflict in the Middle East and related energy price spikes—have delayed some leasing decisions in the Americas, but survey responses indicate that most markets have not seen activity pushed back by these factors.

For landlords and investors across the Americas, Cushman & Wakefield's message is straightforward: the market is moving away from a period when tenants called most of the shots. Coastal U.S. gateways, Latin American nearshoring hubs and select inland distribution markets appear to be on the front edge of that turn, with stabilizing or falling vacancy, rising operating costs and diversified demand all pointing toward firmer pricing power.

The task for experienced investors now is to distinguish where today's tenant-favorable conditions are cyclical and likely to fade—and where they might linger longer because of structural oversupply or weaker local economies.