For much of the pandemic, the US industrial market was characterised by tenants seeking to secure as much warehouse space as possible for the longest possible duration. However, those times are over. The market has normalised, but users have not fully returned to old behaviours. Logistics users are increasingly focusing on flexibility, transport costs, and the ability to adapt without committing to long-term agreements.
CBRE's Mid-Year Industrial Outlook 2026 reported that third-party logistics (3PL) leasing increased by 19 percent year-on-year. 3PLs could account for more than 35 percent of US industrial leasing by 2026. The report indicates that many 3PLs require shorter lease terms, smaller footprints, and more flexible premises. A separate CBRE tenant survey also found that lease flexibility is among the most important criteria for building selection.
Transport costs typically account for about 45 to 70 percent of total logistics costs, compared to just 3 to 6 percent for fixed facility costs such as rent, according to CBRE. This can make leasing another strategically located warehouse – even temporarily – worthwhile if it shortens freight routes and improves delivery times. On-demand warehousing itself remains a relatively small part of industrial real estate, yet a recent market study by Mordor Intelligence estimated that warehouse agreements of less than one month already made up more than half of the on-demand sector in 2025.
Warehub as a response to market needs
James Holbrook founded Warehub, a platform for standardising short-term industrial property leases of up to one year. This enables owners to monetise space between long-term tenants, while offering tenants temporary distribution capacity. Holbrook explained that the concept arose from over 2,500 transactions during the platform's research and development phase. Warehub reportedly has more than 52 million square feet of industrial space nationwide on board.
Mr Holbrook explained in an interview with Commercial Observer that the over 2,500 concluded short-term industrial property leases were part of the company's internal research and development to design the Warehub platform. Warehub was developed to address the limitations faced by modern commerce within the static infrastructure of traditional industrial properties. Industrial properties were designed for long-term leases, yet 50 to 70 percent of a company's total logistics expenditure typically goes to transport.
There is increased demand for short-term space due to the acceleration of e-commerce, the instability of tariffs, and seasonal fluctuations. While landlords generally prefer long-term leases for entire facilities, tenants are increasingly demanding more adaptable geographical placement of their infrastructure. If tenants can create regional distribution hubs in addition to their existing networks, delivery routes can be shortened, freight costs reduced, and inventory needs responded to more quickly. This discrepancy represents the problem Warehub seeks to solve.
Flexibility in distribution networks
Short-term spaces can be used, for example, during seasonal peaks by a tenant temporarily moving inventory closer to their customers, rather than moving everything through the same fixed facilities. This can help stabilise transport costs while supporting sales and replenishment capabilities. Warehub creates a structured leasing environment for this. Tenant requirements feed the supply side, allowing owners to see where active demand exists and make space available when the time is right, without impacting their long-term leasing strategy. The aim is to align the incentives of both parties.
The demand for Warehub to date is scattered and distributed across the Northeast and Southeast of the USA, supplemented by regions in Texas and California. This often stems from companies' need for additional regional capacity. During seasonal peaks, nearby facilities lack the necessary space, and temporary spaces offer a way to address this without having to permanently expand the network.
