The Q3 2024 Warehousing Tracker from Ti Insight – the leading provider of market research to the global logistics industry – shows the global warehousing sector is set for sustained growth through 2025, driven primarily by rising consumer spending, increased logistics demand, and steady manufacturing output expansion from Q2 onward.

Warehouse take-up is projected to remain strong across all quarters, indicating continued demand for storage and distribution space. However, vacancy rates are expected to rise intermittently, particularly in Q4 2024 and Q2-Q4 2025, suggesting that while demand is increasing, new supply may not be keeping pace. New warehouse supply is expected to rebound after Q1 2025, which could help stabilize availability but may not be sufficient to prevent upward pressure on rental costs, which are projected to rise steadily from Q1 onward.

On the cost side, warehousing operators will face mounting financial pressures as rent, labour, and overall operating expenses trend upward throughout 2025. While energy costs provide some relief in the near term, stabilizing from Q2 2025 onward, the anticipated rise in labour expenses through Q1 and Q2, coupled with consistently increasing rents, will contribute to higher overall operational costs. Interest rates remaining level across all quarters may provide some financial predictability, but with logistics demand continuing to grow, companies will likely need to optimize efficiency and invest in automation to mitigate rising costs. As a result, the warehousing industry is poised for expansion, but profitability will depend on strategic cost management and supply chain innovation.

Industry Sentiment Tracker:

In 2024, sentiment on warehousing globally indicated a generally positive outlook for volumes, costs, and demand, though with some fluctuations. Volumes sentiment showed a strong upward trend, particularly in Q2 24 and Q3 24, suggesting an expected increase in warehouse activity compared to early 2023. Costs sentiment was also on the rise, especially in Q2 24 and Q3 24, indicating an expected increase in operational expenses, likely due to higher labour, energy, or storage costs. Demand sentiment remained largely positive, with noticeable peaks in Q2 24, supporting an expected increase in warehousing needs. Compared to 2023, 2024 sentiment suggests a more dynamic environment, where growth in volumes and demand is anticipated, but rising costs may pose challenges.

For January 2025, warehousing sentiment suggests a mixed but generally positive outlook for volumes, costs, and demand. Volume sentiment remained strong throughout the month, though growth is slightly lower compared to late 2024. Cost sentiment shows a consistent expected increase which may signal rising operational pressures, such as labour or energy expenses. Demand sentiment is more volatile indicating a potential slowdown. Overall, January 2025 starts on a positive note for warehouse activity, but rising costs and fluctuating demand may require close monitoring in the coming months.

Note

This analysis was conducted at the same time as the new Trump administration’s proposed tariff increases, the result of which remains to be seen at the time of writing. Higher tariffs will likely have an inflationary effect by increasing the cost of imported goods, forcing businesses to pass these expenses on to consumers through higher prices. This could reduce purchasing power, slow consumer demand, and create supply chain disruptions as companies seek alternative suppliers or shift production domestically. For the warehousing sector, the impact will depend on how businesses respond – reduced imports may lower demand for storage, particularly in key logistics hubs, while stockpiling in anticipation of further trade restrictions could temporarily boost warehouse occupancy. Additionally, if tariffs drive more domestic manufacturing, warehousing demand may shift closer to production centres, leading to regional fluctuations in storage needs. While the overall warehousing outlook remains positive, trade policy uncertainty could introduce volatility in demand patterns.

The full tracker report – available via subscription to Ti’s Freight & Logistics Trackers – tracks key metrics and maps out expectations for warehousing dynamics over the upcoming quarters. The report also provides detailed analysis by region with region specific forecasts, quarter by quarter.

If you have any questions about the tracker report then please contact Michael Clover: [email protected]

About Ti Insight (Ti): Ti is the world’s leading source of market intelligence for the logistics and supply chain industry, providing data and analysis through its market reports, Global Supply Chain intelligence (GSCi) database and expert consultancy services.

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