How AI-Powered Tech Is Reshaping Industrial Real Estate

October 28, 2025

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Prologis, Amazon and Walmart are among the early adopters of this technology.

AI is making its way into industrial real estate in various ways—in building operations but also tenant activities—yet the overall impact on demand for industrial space is still uncertain, according to a new report published by NAIOP Research Foundation and co-authored by Steve Weikal and James Robert Scott of the MIT Real Estate Transformation Lab.

Steve Weikal, lecturer, researcher and the industry chair of the MIT Real Estate Transformation Lab. *Image courtesy of NAIOP Research Foundation*

E-commerce sales could be stimulated by automated marketing informed by AI, which would theoretically boost demand for warehouse and distribution space. On the other hand, more efficient building layouts and supply chains, also informed by AI, might offset that demand.

That is because AI platforms promise to increase the efficiency and output of warehouse and distribution facilities, the report noted, aligning with ongoing industrial real estate trends toward automation and data-driven optimization. That would help occupiers optimize operational design, spur increased productivity in warehouse management and automated systems, and allow tenants to field more advanced robotics. Do more with the same space, that is.

Overall in the commercial real estate sector, AI applications will aim to shorten timelines and improve outcomes at several stages in the development process, with lower costs as the goal for site selection, building design and interior buildouts. The goals will be the same for industrial real estate.

Moreover, the adoption of AI tools in the commercial real estate sector isn’t going to involve significant capital outlays. The AI industry has been quick to develop off-the-shelf AI products and services for the commercial real estate and logistics industries and to firms of all sizes, NAIOP Research reported. The democratization of AI is underway, including in the world’s warehouses.

AI impact starts early

The impact of AI begins in the pre-development stages of an industrial property, the report noted. With AI, developers can more effectively analyze data and identify optimal warehouse locations. AI integrates data on regulations, incentives, complex logistics networks, customer demand patterns and delivery costs, thus enabling more informed site selection.

Moreover, the tools can help pinpoint ideal sites for both smaller distribution facilities that support last-mile delivery in dense urban and suburban areas, along with larger multimarket distribution facilities. The report cites Prologis as an early AI adopter: for the industrial giant, this technology helps evaluate a range of factors, such as access to major ports, key transportation routes and other site-specific variables that affect operational efficiency.

Esri and ArcGIS continue to be the industry standard for modeling distribution and transit networks, but tech startups are rolling out powerful AI-driven tools suitable for companies of all sizes in their quest to enhance locational decision-making. Again, the democratization of AI is at work.

Companies such as CARTO, Spatial.ai and Deepblocks offer advanced geospatial data science and visualization tools, the report noted, while TestFit, London-based Giraffe and Warsaw-based OutlineAI provide strategic analysis of optimum building configurations, parking layouts, road access and zoning compliance.

Warehouse automation: Robots galore

Another major change that AI is poised to make in the industrial real estate sector is after the properties are occupied, NAIOP Research explained: namely, more advanced AI-guided robots. Industrial logistics operators face acute labor shortages, so robotic automation will keep goods moving efficiently through warehouses despite the shortages.

Amazon is on the verge of using more robots than humans in its warehouses, NAIOP Research reported. The retail behemoth has developed six new warehouse robot models over the past three years to improve nearly every stage of the fulfillment process, and is aiming to automate 30 percent to 40 percent of order fulfillment by 2030.

Arch-retail competitor Walmart is also investing heavily in this technology. The company is expanding and retrofitting its grocery fulfillment centers with advanced ASRS infrastructure to enhance supply chain efficiency, which it sees as necessary to maintain its competitive edge in grocery distribution.

Robots are going to be much more numerous in the future at industrial properties, but also better at what they do, the report predicts. The total number of global warehouse robots across all types was about 479,000 units in 2024, By 2030, that total will reach 1.5 million. A new kind of robots, called mobile manipulators, are able to navigate and grasp objects in complex situations, thus having immediate uses in warehouse and distribution processes.