Key Takeaways
- • Clarion Partners has deployed $2 billion over the past year acquiring industrial properties, including a $592 million purchase last month of a seven-property, 2.2 million square-foot portfolio in Los Angeles, Inland Empire, and Seattle fully leased to Amazon and Best Buy.
- • Brookfield Asset Management acquired Peakstone Realty and its 76-property national portfolio for $1.2 billion this month, signaling major capital commitments to industrial real estate despite broader market headwinds.
- • Prologis, the world's largest industrial developer and landlord, achieved record warehouse leasing in 2025, with Los Angeles posting record leasing volume driven by tenant demand for larger buildings with higher ceilings, ample parking, and robust power infrastructure.
- • Transaction volumes are improving as investors return to the industrial sector at scale following a three-and-a-half-year repricing cycle driven by elevated interest rates, according to Clarion's Managing Director Dayton Conklin.
- • The nationwide industrial vacancy rate remains at its highest point in over a decade and is expected to increase further in 2026 before declining, indicating the recovery remains uneven across markets despite institutional investor activity.
Summary
Major institutional investors are driving a selective rebound in industrial real estate, concentrating capital in high-performing asset classes and geographic markets despite sector-wide headwinds. Clarion Partners has emerged as one of the most active participants, deploying $2 billion over the past year to acquire large, newly constructed or fully leased industrial properties positioned near top-performing U.S. ports. The firm's most recent significant transaction—a $592 million acquisition announced last month—comprised seven properties totaling 2.2 million square feet across Los Angeles, the Inland Empire, and Seattle, all fully leased to institutional-grade tenants including Amazon and Best Buy.
Brookfield Asset Management and Prologis have similarly committed substantial capital to industrial assets, indicating sustained institutional conviction in the sector's fundamentals. Brookfield acquired Peakstone Realty and its national 76-property portfolio for $1.2 billion this month, while Prologis, the world's largest industrial developer and landlord, set an annual leasing record in 2025. Los Angeles specifically posted record leasing volume last year, driven by major corporate tenants prioritizing modern specifications: larger floor plates, higher ceiling heights, abundant parking, and robust electrical power infrastructure to support advanced logistics and e-commerce operations.
According to Clarion's Managing Director and Head of U.S. Industrial Dayton Conklin, "Transaction volumes are improving as investors return to the sector at scale. The industrial sector has largely been repriced in light of increased interest rates over the past 3.5 years." This repricing has created opportunities for well-capitalized investors positioned to acquire stabilized assets in prime logistics corridors.
However, the industrial market recovery remains uneven. CoStar research indicates the nationwide vacancy rate stands at its highest level in more than a decade, with further increases anticipated before stabilization occurs in 2026. This bifurcated market—strength in gateway ports and modern, fully leased properties versus weakness in secondary markets and older stock—is driving investor selectivity and geographic concentration among the most sophisticated capital allocators.
Brookfield Asset Management and Prologis have similarly committed substantial capital to industrial assets, indicating sustained institutional conviction in the sector's fundamentals. Brookfield acquired Peakstone Realty and its national 76-property portfolio for $1.2 billion this month, while Prologis, the world's largest industrial developer and landlord, set an annual leasing record in 2025. Los Angeles specifically posted record leasing volume last year, driven by major corporate tenants prioritizing modern specifications: larger floor plates, higher ceiling heights, abundant parking, and robust electrical power infrastructure to support advanced logistics and e-commerce operations.
According to Clarion's Managing Director and Head of U.S. Industrial Dayton Conklin, "Transaction volumes are improving as investors return to the sector at scale. The industrial sector has largely been repriced in light of increased interest rates over the past 3.5 years." This repricing has created opportunities for well-capitalized investors positioned to acquire stabilized assets in prime logistics corridors.
However, the industrial market recovery remains uneven. CoStar research indicates the nationwide vacancy rate stands at its highest level in more than a decade, with further increases anticipated before stabilization occurs in 2026. This bifurcated market—strength in gateway ports and modern, fully leased properties versus weakness in secondary markets and older stock—is driving investor selectivity and geographic concentration among the most sophisticated capital allocators.
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