Why are logistics rents still set to rise: global supply chain restructuring is rewriting warehouse real estate pricing

Why Logistics Rents Will Keep Rising: Global Supply Chain Restructuring Is Rewriting Warehouse Property Pricing

The pricing logic of global logistics real estate is being reshaped by a deeper restructuring of the supply chain.

According to Cushman & Wakefield’s report, *Waypoint: Global Industrial Dynamics 2026*, global logistics and industrial rents have risen by about 36% since 2020. Of the 135 markets it tracks, 61% saw rent increases in 2025, 24% declined, and 15% were flat; looking ahead over the next three years, 54% of markets may continue to rise. On the surface, this reflects supply-and-demand shifts in the real estate market, but more accurately, it reflects a global trade network that is reallocating “where it is worth taking a position, where inventory must be retained, and where faster delivery is needed.”

These changes are not confined to the warehouse market itself. They stem from external shocks to the global trading system: shipping rerouting, geopolitical frictions, energy cost volatility, differences in labor prices, rising automation investment, and companies rebalancing between “low cost” and “high resilience.” Logistics real estate is therefore no longer just infrastructure for the movement of goods, but part of supply chain governance.

From “Transport Cost” to “Space Cost”

Over the past decade and more, globalization has depended on cross-border specialization and extreme inventory efficiency. Companies have tended to compress warehousing, processing, and distribution to the minimum in order to maximize turnover. But after the pandemic, supply chain disruptions, port congestion, shipping rerouting, and geopolitical conflicts changed the decision-making logic. Companies began to realize that what is truly expensive is not just ocean freight or air freight, but the chain-wide losses caused by the absence of a “critical node.”

This explains why logistics real estate pricing still shows resilience. High rents not only mean land and space are scarce, but also that the market is pricing in higher service levels and a lower probability of disruption. For multinational manufacturers, third-party logistics providers, and e-commerce platforms, warehouse space close to consumer markets, ports, airports, and regional distribution hubs has become strategically valuable.

The report notes that global logistics rents rose 2.2% in 2025, while wages increased 2.4% and electricity prices fell 0.4% on average. This set of data shows that what drives warehousing costs is not only land prices, but also the reconfiguration of operating factors. As automation, cold chain systems, electrification, and energy-intensive equipment become more widespread in logistics systems, electricity prices and power supply stability are becoming important location factors. In other words, a warehouse is no longer just a place to store goods, but an industrial node that must be coordinated with the energy system, labor structure, and transportation network.

Divergence in Asia-Pacific Markets Shows Trade Flows Are Adjusting

Rental performance across Asia-Pacific is uneven. The Philippines, Australia, Japan, and Singapore recorded strong growth, while some markets in mainland China came under pressure due to weaker demand and relatively high vacant supply. This divergence itself reflects the rebalancing of global manufacturing and trade distribution routes.

On the one hand, Southeast Asia and some mature port economies are attracting more demand related to regional distribution.On the one hand, Southeast Asia and some mature port economies are attracting more demand related to regional distribution. For companies, allocating capacity and inventory outside China has become an important part of supply chain diversification. On the other hand, some logistics markets in mainland China are being influenced by end-demand, manufacturing cycles, and newly added supply, resulting in relatively subdued rent performance. This does not mean that China’s logistics network has lost its importance; rather, it shows that its role is shifting from a single manufacturing hinterland to a more complex structure that balances domestic demand, exports, and regional supply chain coordination.

Singapore is a particularly representative case. The report notes that Singapore remains one of the logistics markets with relatively high rents in the Asia-Pacific region, due to its role as a trade gateway and the scarcity of high-quality warehouse space. For companies dependent on transshipment, regional distribution, and high-frequency replenishment, space close to global shipping mainlines and an efficient port system commands a clear premium. This premium is not a real estate bubble, but the result of a highly concentrated global trade network.

Geopolitics is turning logistics from a cost issue into a risk issue

Cushman & Wakefield identifies geopolitical risk and energy shocks as key variables, and this is especially worth attention. The reduced fuel supply, shipping route disruptions, and rising transportation costs brought on by the situation in the Middle East are no longer just short-term fluctuations in the maritime market, but long-term variables affecting corporate site selection and inventory strategies.

When shipping routes become unstable, companies tend to shorten replenishment chains, increase safety stock, or place more distribution resources near target markets. As a result, demand rises simultaneously for port-adjacent warehousing, nearshore manufacturing support, regional distribution centers, and multi-node inventory layouts. Rising logistics property rents are often not because final consumption has suddenly boomed, but because companies are willing to pay a premium for “sustainable fulfillment capacity.”

This also shows that global supply chains are shifting from a sole focus on minimum cost toward emphasizing resilience, substitutability, and visibility. For the international trade system, this is a structural turning point: logistics not only determines whether goods can arrive, but also whether the trade system can withstand shocks.

Over the next three years, what will truly be scarce is “good location,” not “more space”

The report expects market conditions to tighten further by 2029, with the share of tenant-friendly markets possibly falling from 52% in 2026 to 33%, while landlord-friendly markets rise to 39%. This means the currently relatively loose leasing environment may not last very long.

For companies, the next round of competition is not just about securing cheaper warehouses, but about competing for key locations closer to ports, airports, consumer markets, and manufacturing clusters. Precisely for this reason, logistics real estate has become more closely linked with port capacity, mainline transportation efficiency, regional trade agreements, and industrial relocation.E-commerce will still be the most important demand driver over the next three years, while retail distribution and general manufacturing will continue to support demand. At the same time, new demand from energy, high technology, automotive, aerospace, and cold chain sectors is entering the logistics real estate market. This shows that the growth of logistics space is not uniform, but is instead acceleratingly concentrating along industries with high value added, strong time sensitivity, and high energy consumption.

The Upturn in Logistics Real Estate Reflects a New Stage of Globalization

If the keyword of the last round of globalization was “efficiency,” today’s keywords are becoming “resilience, nearshoring, and regionalization.” Rising rents are not just a price signal in capital markets; they are more like a thermometer of the global trade system. When companies begin paying more for inventory security, transport certainty, and energy availability, the global supply chain is no longer driven by a single center, but has become a network in which multiple regions, multiple nodes, and multiple standards coexist.

Seen from this perspective, logistics real estate is not passively following changes in trade, but is instead revealing the direction of trade restructuring in advance. Changes in the prices of warehouses, ports, distribution centers, and industrial land often provide earlier clues than macro data: the global industrial chain is moving from integration to stratification, from lean inventory to strategic inventory, and from single-route operations to multi-channel allocation.

This is also why the continued rise in logistics rents cannot be simply understood as an upswing in the real estate cycle. It is more like a repricing of infrastructure after the global trade system has entered a new stage.