Large-format industrial leasing is back in a big way. According to new research from Cushman & Wakefield, demand for warehouses larger than 500,000 square feet surged in the second half of 2025, signaling a strong rebound in big-box activity after a brief slowdown in 2023 and 2024.

The report, Large-Format Deals Return, finds that deals over 500,000 square feet jumped 32% year over year, with third-party logistics providers (3PLs) and manufacturers accounting for nearly two-thirds of that activity. In total, 113 million square feet of net absorption occurred in newer, larger warehouse and logistics facilities, representing 64% of the nationwide total.

"This is a clear return of the large-format tenant," said Jason Price, Americas Head of Logistics & Industrial Research at Cushman & Wakefield. "Companies are consolidating operations, upgrading to higher-quality facilities, and making more strategic decisions about where and how they deploy space."

Consolidation and the ‘flight to quality'

The research shows that many occupiers are exiting multiple smaller, outdated buildings and consolidating into modern Class A facilities with higher clear heights, stronger power capacity, and infrastructure that supports automation and robotics. This "flight to quality" is also driving more build-to-suit activity, as tenants look to customize facilities for efficiency and long-term operations.

Build-to-suit development rose 11% in 2025, and nearly one-fifth of all leasing activity above 500,000 square feet was tied to build-to-suit projects. Large build-to-suit projects currently underway increased 14% year over year, positioning them as a key driver of net absorption in 2026.

Cost pressures reshape where companies grow

Cost sensitivity is also playing a major role in market selection. Of the 104 large leases signed in 2025, 71% were in markets priced below the national average rent, and nearly two-thirds were in markets at least 20% cheaper than the U.S. average. As a result, demand is increasingly shifting toward inland and lower-cost markets, and away from higher-priced coastal and port-adjacent locations.

"With occupancy tightening and new supply limited, tenants are getting more strategic about both location and design," said Price. "We're seeing a strong focus on efficiency, total occupancy cost, and long-term operational performance."

Implications for occupiers and investors

The report also notes that vacancy rates for large warehouses declined by 140 basis points year over year, while user-purchase activity hit 36.7 million square feet in 2025, the highest level of the decade. With fewer large speculative projects in the pipeline and demand reaccelerating, conditions are expected to support improving occupancy and future rent growth, particularly for high-quality assets.

For investors, rising interest in well-located, modern industrial properties is supporting increased capital deployment and healthy net operating income growth, especially in key distribution markets.

Looking ahead

With large-format leasing back at multi-year highs, build-to-suit development accelerating, and cost-conscious strategies reshaping location decisions, Cushman & Wakefield expects momentum in the industrial sector to continue into 2026, especially for newer, larger logistics facilities.

The report is available to view here.

About Cushman & Wakefield

Cushman & Wakefield (NYSE:CWK) is a leading global commercial real estate services firm for occupiers and investors with approximately 53,000 employees in over 350 offices and nearly 60 countries. In 2025, the firm reported revenue of $10.3 billion across its core service lines of Services, Leasing, Capital markets, and Valuation and other. Built around the belief that Better never settles, the firm receives numerous industry and business accolades for its award-winning culture. For additional information, visit www.cushmanwakefield.com.

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Savannah Durban

savannah.durban@cushwake.com

Cushman & Wakefield Research Shows Large Warehouse Deals Roar Back as Big-Box Leasing Rebounds Across U.S.