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Prologis Cuts Down on Development as Industrial Leasing Slows

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Author

Han Lung
May 13, 2025

May 5, 2025

Your City. Your Market. Your Next Deal.

Today's story: Prologis is slashing $1B from its 2025 development plans as leasing slows and tenants delay decisions amid growing tariff uncertainty.

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Prologis Cuts Projects as Industrial Leasing Slows

Source: CoStar

What happened: Prologis is cutting over $1 billion from its 2025 development plans, blaming slower tenant decision-making and leasing activity due to global tariff uncertainties. Despite a strong Q1 with revenue up 9.5%, the company’s outlook cooled after tariffs were announced in April.

A closer look: Leasing dropped, with 21 million square feet of new leases and 42 million square feet of renewals signed in Q1. Activity slowed by 20% in April, though 108 million square feet is still in negotiation. Lease timelines stretched to an average of 64 days, but e-commerce players like Amazon are still active, representing 20% of Q1 leasing. Occupancy is holding at 95%, and rent growth has slowed. 

Why it matters: With a large amount of new supply entering the market, rent growth is expected to continue decelerating as tenants gain more leverage. Despite these challenges, demand for warehouse space remains strong as companies adjust to changing supply chain needs.

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