The frenzied pace of competition for industrial space appears to be normalizing to pre-pandemic levels and new supplies of warehouse space could ease leasing conditions – a trend that may not last long. 

Prologis' Industrial Business Indicator rose to 62.3 for the second quarter. This "reflected a better-than-expected goods economy as a majority of logistics users reported an increase in the flow of goods through U.S. facilities," Prologis found. "Utilization on average remained in the sweet spot of 85% to 86% during the second quarter, indicating a lack of shadow space in facilities."

Rents rose 2% in the second quarter, with a forecast rise of 7% to 9% for the year — a pace approaching pre-pandemic levels. After years of double-digit rent growth led to more than 100% rent growth in some markets, leases will experience "substantial repricing" when they expire, Prologis stated.