A shift to built-to-suit development is gaining momentum across industrial real estate, particularly in key logistics hubs such as New Jersey.
As supply chains become more complex and automation-driven, many occupiers are finding that existing warehouse space no longer meets their needs. Instead, they’re seeking highly customized facilities designed around robotics, advanced logistics systems, and specific operational requirements, thereby driving increased demand for built-to-suit projects and accelerating the obsolescence of older assets.
Across New Jersey and the broader Northeast corridor, while leasing remains strong at newer properties, many tenants are opting for purpose-built spaces rather than retrofitting existing buildings, especially as efficiency and automation needs continue to evolve.
Blake Chroman, principal, Sitex Group, said that in New Jersey, the rebound is showing up clearly in big-box leasing activity.
According to Cushman & Wakefield, big-box transactions accounted for 6.8 million square feet in 2025, including 19 new leases over 200,000 square feet, as part of 24.7 million square feet of total warehouse and distribution leasing statewide.
On top of that, the forward pipeline remains strong: JLL data shows more than 13 million square feet of active large-scale requirements across New Jersey and the broader Northeast over the past six months.
“Taken together, those numbers point to both meaningful closed leasing volume and a deep pool of current demand for large-format industrial space,” Chroman told BINJE.
Chroman said he’s seeing firms upgrade to more efficient space across a range of companies that are upgrading and, in many cases, consolidating into it.
“A lot of these occupiers are coming out of older Class B buildings and moving into newer Class A facilities with higher clear heights, better loading, increased electrical capacity to support more advanced material handling, improved HVAC systems, and more parking for both vehicles and trailers,” Chroman said.
“The common theme is that companies are looking for buildings that allow them to operate faster and more efficiently, essentially doing more with less.”
There are three things Chroman is seeing in this market.
First, large occupiers are active again, but the supply of large-format buildings is incredibly limited, he said.
There are currently only five buildings over 1 million square feet available for lease, either directly or subleased, across the state, along with three under construction.
“That supply-demand imbalance should lead to healthier rents and fewer concessions in the near term,” he said.
Second, some of the larger occupiers are opting for longer-term leases, typically 10 years or more, as their investment in material handling and technology has increased, and they’re looking to amortize those costs over a longer period.
And third, some of the large occupiers, particularly in e-commerce and third-party logistics, that were relatively quiet following the COVID-era leasing surge from 2020 to 2022 appear to be active again.
