Inland Warehouse Demand Now Leads Port Markets
Owners and occupiers of industrial property should weigh inland versus port locations as vacancies and rents diverge.
Updated on Nov. 3, 2026 in Commercial
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Demand for industrial warehouse space has shifted toward inland U.S. markets over the past two years, according to a Cushman & Wakefield report released October 19, while port markets show tightening vacancies. Owners and occupiers of commercial industrial property nationwide are affected as the market reorders around inland distribution hubs.
Why it matters
Inland markets now absorb the largest share of new industrial demand, reaching 83% of absorption, the highest level since 2010, which affects rent and leasing decisions for industrial occupiers. Rising diesel costs tied to the Iran war and demand for newer, automation-ready warehouses are pushing companies inland where labor, rents and energy costs are often lower.
Vacancy in port markets runs 110 basis points above the national average of 6.6%, while the inland share of industrial absorption reached 83%. Cushman & Wakefield projects port-market rent growth above 5% through 2028 in seven of 13 key North American markets.
The players
Cushman & Wakefield
A global commercial real estate services firm whose research tracks industrial vacancy, absorption and leasing trends across North American markets.
CBRE
A large commercial real estate services firm whose industrial research covers warehouse inventory and automation-readiness across U.S. regions.
Prologis
One of the largest industrial real estate owners and developers, whose data tracks goods movement through U.S. warehouses.
John Kirkman
Senior Managing Director at CBRE who said companies are seeking newer warehouse builds ready for automation upgrades.
Melinda McLaughlin
SVP and global head of research at Prologis who said there is limited evidence of broad warehouse relocation inland.
The details
More goods are moving by truck or rail to inland distribution hubs, a shift supported by rising import volumes from Mexico. Shippers are trying to cut costs as diesel prices spike, and many want newer warehouse buildings that can accommodate automation upgrades, which inland markets have in greater supply. CBRE Senior Managing Director John Kirkman noted there is more class A newer warehouse inventory inland. Cushman & Wakefield expects demand to strengthen and vacancies to tighten in port markets including Hampton Roads, Savannah, Charleston and Los Angeles.
Timeline
Over the past two years, demand has shifted toward inland industrial markets.
On October 19, Cushman & Wakefield released its inland demand report.
Through 2028, record port-market rent growth above 5% is forecast for seven of 13 key markets.
The Home Front
Inland industrial absorption at 83% is the highest share since 2010, placing the current shift in a multi-year pattern of warehouse demand moving away from coastal ports. The trend matters for property owners and tenants weighing where to invest in industrial space as port rents are forecast to climb.
If you own or lease commercial industrial space, compare current vacancy and rent figures in your market against the port and inland benchmarks cited here before renewing or signing. Consider consulting a licensed commercial broker or attorney before any lease or purchase decision.
The takeaway
Demand is migrating inland, so location now matters as much as building quality for industrial occupiers. Keep a current record of your market's vacancy and rent trends so you can compare them with port and inland benchmarks at your next lease review.
Further reading
Explore more on commercial real estate trends shaping warehouse demand across the country.
Source note: This article includes information reported by Supply Chain Dive.
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