CBRE Survey Finds Industrial Lease Expirations Fuel Flight to Quality Across U.S.

More than 1.7 billion sq. ft. of industrial leases are set to expire within the next 36 months, setting the stage for increased demand for higher-quality space, according to a recent survey of industrial occupiers by CBRE Research.

CBRE’s 2026 U.S. Industrial & Logistics Occupier Survey found that more than 90% of occupiers plan to maintain or expand their portfolios in the next 36 months, motivated by a need for newer space (23%) or lower costs (17%). This reflects a continued shift away from older assets, which have recorded over 400 million sq. ft. of negative net absorption in the past three years.

CBRE expects that owners of older pre-2020 buildings may need to offer more concessions to secure tenants, mainly because they are increasingly locating in more modern, functionally efficient facilities.

“The increased volume of lease expirations will give occupiers a meaningful opportunity to reassess and reposition their portfolios,” said John Morris, President of Americas Industrial & Logistics for CBRE. “This shows a reset in industrial leasing, and we expect to see a continued flight to quality as companies look for modern buildings that reduce operating costs and improve supply chain efficiency.”

Despite broader industry concerns about power supply, 90% of survey respondents said they are only somewhat or not at all concerned about power availability or grid reliability. Fifty‑nine percent are not currently using AI in their logistics operations, and 36% do not plan to adopt it soon. Among those using or planning to implement AI, the most common applications are inventory management and evaluating network locations.

Regional Expansion and 3PLs

The Southeast ranked as occupiers’ top region for expansion, cited by 30% of respondents. The region’s large pipeline of modern buildings, growing manufacturing base and proximity to high‑growth population centers position it as the leading destination for new facilities. The Midwest followed with 22% citing expansion plans, reflecting continued demand for centrally located distribution networks.

“Access to transportation hubs, including ports and major interstate corridors, remains critical for most occupiers,” said James Breeze, CBRE’s Head of Industrial Research, Americas. “These factors directly influence their ability to serve customers and manage supply-chain performance.”

Third-party logistics providers (3PLs) were the most active tenant group for bulk industrial leases of 100,000 sq. ft. or more in 2025, capturing a 36% share of activity. More than 32% of occupiers surveyed plan to increase their use of 3PLs over the next three years for additional flexibility amid cost pressures and shifting customer expectations.

Occupancy Costs & Other Site-Selection Considerations

Occupancy-related expenses remain occupiers’ top challenge. CBRE estimates that an occupier with a five-year lease expiring in late 2025 could face an average 27% rent increase upon renewal. In some high-demand markets, such as northern New Jersey, Houston and South Florida, occupiers could expect a doubling of rent compared with prior lease terms.

When selecting markets, respondents identified the availability of new space as their top consideration (23%), followed by lower costs (17%) and supply chain diversification (16%). For building selection, occupancy costs and flexible lease terms were occupiers’ top concerns (18% each).

CBRE conducted its survey from December 2025 to February 2026 from a mix of industry sectors.