{"id":1004694880,"date":"2026-01-12T05:05:10","date_gmt":"2026-01-12T13:05:10","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004694880"},"modified":"2026-03-28T10:36:29","modified_gmt":"2026-03-28T18:36:29","slug":"whats-next-for-industrial-real-estate","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/whats-next-for-industrial-real-estate\/","title":{"rendered":"What Will Define Industrial’s Next Stage of Growth?"},"content":{"rendered":"\n

As the new year unfolds, the U.S. industrial market is entering a new phase of growth. After several years of unbridled development, fundamentals began to normalize in 2025, shaped by uncertainty around tariffs, interest rates and trade policy. At the same time, physical and operational constraints around construction have shifted, prompting developers and operators to place greater emphasis on efficiency, discipline and balance.<\/p>\n\n\n

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Infill industrial assets such as this Link Logistics warehouse in Philadelphia will be a key part of the sector’s future.
Image courtesy of Link Logistics<\/em><\/figcaption><\/figure><\/div>\n\n\n

Demand remains strong, but the narrative is changing. The question is no longer whether industrial real estate will continue to thrive, but how that growth will be defined\u2014and which owners and operators are best positioned to deliver the next generation of facilities. <\/p>\n\n\n\n

Increasingly, success hinges upon the ability to respond to new operational realities, from nearshoring and reshoring manufacturing<\/a> and building redundancy into supply chains, to accommodating automation- and AI-enabled facilities and supporting infrastructure.<\/p>\n\n\n\n

“Where trade policy with major partners like China and Canada ultimately lands remains an open question, and the recent disruptions from trade disputes reinforces the importance of supply chain resiliency, which should prompt occupiers to continue their recent efforts to diversify their supply chains,\u201d Marc Selvitelli, president & CEO of NAIOP, told Commercial Property Executive<\/em>, pointing to one of the most pressing issues shaping industrial\u2019s next stage of growth, following the speculative sprint of 2022-2024.<\/p>\n\n\n\n

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READ ALSO:<\/strong> Emerging Industrial Markets<\/a> <\/p>\n\n\n\n

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Regional nuances<\/h2>\n\n\n\n

Development patterns in 2025 provide early clues about how the industrial market may evolve in 2026. About 20 percent of new starts last year were build-to-suit facilities\u2014roughly in line with historical averages\u2014according to the latest Emerging Trends in Real Estate<\/em> report<\/a> from ULI and PwC. At the same time, construction of large-format assets slowed dramatically: New development of facilities larger than 750,000 square feet fell 85 percent year-over-year. Taken together, these trends suggest a potential shortage of big-box product heading into 2026.<\/p>\n\n\n\n

Against that backdrop, regional advantages are becoming more pronounced. With e-commerce and third-party logistics continuing to drive demand, markets that offer efficient national distribution are positioned to gain an early edge. The Midwest, where travel times allow goods to reach most parts of the country quickly, exemplifies this dynamic, with Chicago posting particularly strong fundamentals. Texas and the Southeast are benefiting from a different but equally powerful mix of drivers, including population growth, manufacturing reshoring<\/a> and access to major ports such as Savannah, Ga.<\/p>\n\n\n\n

While overall new development<\/a> is expected to remain restrained in the near term, several signals could point toward the next phase of speculative construction\u2014albeit at a more measured pace than in prior cycles. According to Brandon Page, executive vice president & head of leasing at Link Logistics, the return of bulk leasing activity\u2014largely absent from recent national trends\u2014would be a key catalyst.<\/p>\n\n\n\n

Early demand metrics suggest momentum is building, even if gradually. In the first half of 2025, net absorption totaled 57 million square feet, noted Stephanie Rodriguez, national director of industrial services at Colliers. By the third quarter alone, absorption reached roughly 60 million square feet, exceeding the total from the prior six months. Rodriguez expects the ramp-up toward the next construction cycle to unfold more slowly than before, with continued reliance on the balance between build-to-suit and speculative development.<\/p>\n\n\n

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Trident Logistics Center is currently under construction in Revere, Mass. Metro Boston is a key hub for industrial space, serving the region’s advanced manufacturing, life sciences and a high-income consumer base.
Image courtesy of Link Logistics<\/em><\/figcaption><\/figure><\/div>\n\n\n

Looking ahead, one constraint cuts across markets and regions: infrastructure capacity. Unlocking the next stage of industrial growth in 2026 will hinge not only on tariffs, but also on access to energy, particularly as manufacturing becomes an increasingly important demand driver. <\/p>\n\n\n\n

“It used to be that for a 200-to-300,000-square-foot warehouse building, 1,600 amps of power was sufficient. Not anymore,” Rodriguez said. <\/p>\n\n\n\n

Power availability becomes central to industrial growth<\/h2>\n\n\n\n

Power access is emerging as one of the most critical constraints shaping industrial development. Developers are increasingly engaging utility providers early in the planning process to understand how much power a site can realistically support\u2014and, just as important, to demonstrate projected demand before capacity can be delivered. The process increasingly mirrors that of data centers, where lead times for power availability often determine speed to market.<\/p>\n\n\n\n

Delays in securing sufficient electrical capacity can now extend up to two years, according to the ULI and PwC report, while upgrades to existing infrastructure frequently take 12 months or more. These timelines are forcing developers and occupiers alike to factor power planning into site selection and project feasibility much earlier than in previous cycles.<\/p>\n\n\n

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Huntsville, Ala., will become the site of a $6 billion manufacturing facility for pharmaceutical giant Eli Lilly and Co.
Image courtesy of Eli Lilly and Co.<\/em><\/figcaption><\/figure><\/div>\n\n\n

The urgency is being amplified by the changing composition of demand. Across the Southeast and Central U.S., manufacturing accounted for 20 percent of new industrial leasing, the same report shows\u2014underscoring the sector\u2019s growing role as a driver of industrial real estate activity.<\/p>\n\n\n\n

That shift is also evident in the scale of projects being launched or coming online. Efforts to build greater supply chain resiliency and redundancy have translated into large, power-intensive developments, including Eli Lilly\u2019s $6 billion investment in Alabama<\/a>, the largest private industrial project in the state\u2019s history, and Hyundai\u2019s $7.6 billion manufacturing facility in Ellabell<\/a>, Ga.<\/p>\n\n\n\n

While manufacturing and reshoring are expected to contribute meaningfully to industrial growth in 2026 and beyond, they also compound existing challenges. These projects carry significant electricity and labor requirements, bringing efficiency, infrastructure readiness and workforce availability back to the forefront of development strategy. <\/p>\n\n\n\n

Sustainability considerations are becoming increasingly intertwined with these priorities. Page noted that sustainability is a clear determinant of leasing velocity, with strategies such as rooftop solar installations, energy-efficient building systems and pre-purchasing power capacity expected to play a pivotal role in U.S. industrial markets in 2026 and beyond. <\/p>\n\n\n\n

AI and automation proliferate<\/h2>\n\n\n\n

Efficiency is becoming more multidimensional inside industrial facilities, extending well beyond footprint alone. “Cubic efficiency is a phrase that we hear now more than ever before,\u201d Page added. \u201cI think we\u2019re seeing groups that, historically, have had a little bit more slack in their system, have now made their facilities more functional.\u201d<\/p>\n\n\n\n

Oftentimes, more functional implies more automation, a key trend that is likely to gain traction in 2026. <\/p>\n\n\n\n

Operators will continue to deploy labor-saving technologies to navigate a persistently tight labor market\u2014a strategy that has gained momentum over the past several years. Automated storage and retrieval systems and cobots, or collaborative robots designed to work alongside humans, are the most common examples among advanced adopters such as Amazon and Walmart. For now, however, these systems are likely to remain concentrated among large-scale operators given the capital investment and operational complexity involved.<\/p>\n\n\n

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In May 2025, Amazon launched its Vulcan robot, which has an advanced sense of touch, allowing it to manipulate delicate goods.
Image courtesy of Amazon<\/em><\/figcaption><\/figure><\/div>\n\n\n

AI, by contrast, is gaining broader traction across the industrial real estate lifecycle. Rather than being limited to warehouse operations, AI tools are increasingly being used to improve speed, precision and decision-making well before construction begins. Selvitelli noted that some of the largest time-saving benefits emerge early in the development process, “allowing development teams to more quickly identify sites that meet key criteria, evaluate options for land packaging, model several different design and use options for a new project, and identify when a specific option would likely require a zoning variance.”<\/p>\n\n\n\n

AI adoption is also expanding on the occupier side. Large users are deploying increasingly sophisticated algorithms to forecast space needs\u2014sometimes years in advance\u2014while generative AI is beginning to influence marketing and leasing strategies by enhancing campaigns and improving customer targeting.<\/p>\n\n\n\n

Supply chain resiliency ties everything together<\/h2>\n\n\n\n

The final\u2014and most complex\u2014piece shaping industrial real estate\u2019s trajectory in 2026 and beyond is trade policy and geopolitical uncertainty. While industrial development is surging along the Southern border<\/a>, that growth story is uneven across regions and occupier types, underscoring how sensitive parts of the sector remain to global policy dynamics. <\/p>\n\n\n\n

Retailers, wholesalers and manufacturers that depend heavily on raw materials, components or finished goods sourced from countries subject to high tariffs\u2014or ongoing tariff unpredictability\u2014are likely to feel the greatest impact. \u201cPart of the reason why corporate America stayed on the sidelines is there\u2019s just been so much uncertainty, and the time to ramp up supply chain networks takes time,\u201d Page pointed out.<\/p>\n\n\n\n

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READ ALSO:<\/strong> AI in Industrial Real Estate<\/a><\/p>\n\n\n\n

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Even so, many industrial occupiers are pressing ahead with expansion plans, particularly as reshoring and nearshoring efforts create new regional opportunities. According to Selvitelli, recently announced agreements with countries such as South Korea, Vietnam and Japan are already giving importers greater visibility, allowing them to plan supply chains with more confidence despite broader geopolitical risks.<\/p>\n\n\n\n

Over the long term, the structural drivers underpinning industrial demand remain firmly in place. Strategies centered on port redundancy, geographic diversification and supply chain de-risking are expected to continue shaping site selection and development decisions. Taken together, these dynamics point toward a more balanced phase for U.S. industrial real estate, one in which markets move closer to equilibrium in 2026, and growth is driven less by speed and more by methodical, resilience-focused execution.<\/p>\n","protected":false},"excerpt":{"rendered":"

After years of rapid expansion, the sector enters 2026 focused on efficiency, power availability and long-term resiliency. Here’s what to watch. <\/p>\n","protected":false},"author":1284,"featured_media":1004783510,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[52688,21808,21748,23891,51037],"tags":[50647,35498,51531,32878],"class_list":["post-1004694880","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-artificial-intelligence","category-featured","category-industrial","category-national","category-trends","tag-keypredictions","tag-colliers","tag-link-logistics","tag-naiop"],"acf":[],"yoast_head":"\nWhat Will Define Industrial's Next Stage of Growth? - Commercial Property Executive<\/title>\n<meta name=\"description\" content=\"The future of U.S. industrial markets in 2026 is tied to a more methodical approach, as compounding issues must be navigated.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/whats-next-for-industrial-real-estate\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What Will Define Industrial's Next Stage of Growth?\" \/>\n<meta property=\"og:description\" content=\"The future of U.S. industrial markets in 2026 is tied to a more methodical approach, as compounding issues must be navigated.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/whats-next-for-industrial-real-estate\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2026-01-12T13:05:10+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2026-03-28T18:36:29+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2026\/01\/the-2026-report-image-CPE_Industrial.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"930\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Tudor Scolca\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/whats-next-for-industrial-real-estate\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/whats-next-for-industrial-real-estate\/\",\"name\":\"What Will Define Industrial's Next Stage of Growth? 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