Prologis, the world’s largest industrial property company, is warning of a slowdown in warehousing markets in the coming quarters as customers focus on tamping down logistics costs, The Wall Street Journal reports.
While the San Francisco-based real estate giant logged better-than-expected revenue in the latest quarter, it cut its annual guidance for the year. The move is the latest sign that the rapid growth in warehousing demand driven by the pandemic is waning amid broader shifts in consumer spending and tighter inventory controls by retailers and manufacturers.
Other real estate industry experts have also warned of impacts to the warehousing markets.
Analysts Savills and Cushman & Wakefield recently said in reports that pricing for logistics properties has flattened out in the past two quarters after a surge in demand and tight capacity sent leasing rates sharply higher from 2020 to 2023.
The average warehouse vacancy rate across the U.S. climbed to 5.8% in the first quarter from 5.2% the previous period, according to Cushman.
