Logistics Space Demand Could Grow By Up To 350M SF By 2030

Prologis projects e-commerce will reach 30% of core retail sales by 2030, driving the need for up to 350M SF of additional logistics space.

March 27, 2025

Jordan B.

Prologis projects 250M–350M SF of additional logistics space will be needed by 2030 to support growing e-commerce sales.
E-commerce made up more than half of all retail sales growth in 2024 and now accounts for 16.1% of total US retail sales.
With online shopping set to hit 30% of core retail goods sales by 2030, fulfillment strategies are shifting toward urban, last-mile warehouse locations.

Key Takeaways

E-Commerce Growth Isn’t Slowing Down

New data from Prologis shows e-commerce sales grew 8% year over year in 2024. When adjusted for inflation, that growth jumps to 10%, far outpacing in-store sales, which rose just 1.8%, according to FreightWaves.

This growth isn’t just a short-term trend. Prologis projects that e-commerce could make up 30% of core retail goods sales by 2030. To support this shift, the market may need hundreds of millions of additional square feet in warehouse space.

Retail Shrinking, Logistics Expanding

As shoppers continue to prioritize value, convenience, and variety, traditional retail is shrinking. Store closures in 2024 hit their highest levels since 2020.

In response, many retailers are shifting to smaller stores with limited inventory. Showrooming—where shoppers browse in-store but buy online—is becoming more common. These trends are increasing the need for fast, local fulfillment from nearby warehouses.

Since 2019, total occupied logistics space has grown by 12%. Meanwhile, overall retail space has declined by 2.4%. The balance is clearly shifting.

Global Trends and Policy Shifts

International players are also driving demand. Chinese platforms like Shein and Temu are expanding their US presence by partnering with local third-party sellers.

In 2024, Asian 3PL providers accounted for nearly 20% of new industrial leases in the US. This trend is partly fueled by uncertainty around the “de minimis” rule. Currently, goods under $800 are exempt from tariffs. However, if that policy changes, companies may need to shift toward storing inventory in the US and using slower, cost-effective shipping methods.

Consumers Expect Efficiency

Speed remains a top priority for shoppers. About 70% of consumers expect same- or next-day delivery. This has pushed retailers to rethink supply chains and invest in warehouse space near urban centers.

In 2024, Southern California, New York City, and Chicago made up 55% of e-commerce leasing activity in Prologis’ portfolio. These metro areas are key to meeting fast delivery expectations.

The Bigger Picture

As digital shopping continues to grow, logistics infrastructure must keep up. Retail footprints may be shrinking, but demand for warehouse space is rising fast.

The future of retail is being built behind the scenes—through fulfillment centers, supply chain recalibration, and smart warehouse expansion. This shift is not temporary. It’s structural, and it’s reshaping how goods move in the modern economy.