A new wave of ecommerce growth is igniting unprecedented demand for logistics real estate, signaling that the digital shopping revolution is far from over.
As online retail sales growth continues to outpace brick-and-mortar, the backbone of this expansion — industrial logistics space — is becoming the most valuable asset in the retail supply chain.
This insight comes from a new research paper by Prologis. The firm’s report, The Ecommerce Boom Isn’t Over: Implications for Logistics Real Estate, analyzes the evolving relationship between online retail and supply chain infrastructure. And the findings are clear: Logistics space is the cornerstone of future retail growth. Prologis is a logistics real estate company that manages over a billion square feet of industrial property globally.
Logistics and the backbone of ecommerce
In 2024, U.S. ecommerce accounted for 56% of total retail sales growth. It climbed 8% year over year compared to just 1.8% for in-store sales, the report says.
Ecommerce has accounted for at least a fifth of U.S. retail sales every year since 2020, Digital Commerce 360 analysis shows. More than $500 billion of 2024’s U.S. ecommerce sales came from the two largest online retailers in North America. Those two retailers also have largest ecommerce logistics networks.
As digital sales expand, so does the need for efficient fulfillment. According to Prologis, ecommerce still requires roughly three times the logistics space of traditional retail ratio that has remained stable for a decade.
Retailers are adjusting quickly. Since the pre-pandemic period, occupied logistics space in the U.S. has surged 12%, while occupied retail space (excluding service-based retail) has declined by 2.4%. With ecommerce penetration projected to rise from 24% today to 30% by 2030, Prologis estimates the U.S. will need an additional 250 to 350 million square feet of industrial space over the next five years.
Much of this growth is concentrated in key logistics hubs. In 2024, 55% of ecommerce leasing in the U.S. occurred in just three markets: Southern California, greater New York City, and Chicago. These locations offer the scale and proximity needed for faster delivery at a perk 70% of consumers now expect, along with free returns.
Cross-border ecommerce is another major driver. Fast-fashion platforms like Shein and Temu saw U.S. revenues soar to $44 billion in 2024 and are expanding their logistics operations stateside, Prologis says. Asian third-party logistics providers, especially Chinese 3PLs, accounted for nearly 20% of U.S. industrial leasing last year, a trend expected to continue in 2025.
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