How AI-Powered Tech Is Reshaping Industrial Real Estate

Artificial intelligence is rapidly reshaping the industrial real estate landscape—affecting not only how buildings are designed and operated but also how tenants manage their logistics and warehouse activities.

Yet, the overall impact on demand for industrial space remains uncertain, according to a new report from the NAIOP Research Foundation, co-authored by Steve Weikal and James Robert Scott of the MIT Real Estate Transformation Lab.

AI could boost e-commerce sales through data-driven marketing, theoretically increasing demand for warehouse and distribution space. However, the same technology might offset that growth by enabling more efficient building layouts, supply chains, and operations.

The report highlights that AI platforms are enhancing efficiency and output in warehouses and distribution centers—extending existing trends toward automation and data optimization. With AI, occupiers can design more efficient operations, raise productivity, and deploy advanced robotics—essentially allowing them to do more with the same amount of space.

Across the broader commercial real estate sector, AI tools are being used to streamline development processes—from site selection and building design to interior buildouts—reducing costs and improving outcomes. Importantly, these innovations don’t always require large capital investments. The AI industry is producing affordable, off-the-shelf solutions for logistics and real estate firms of all sizes, driving a democratization of AI—even in warehouse environments.

AI’s Early Impact: Smarter Site Selection

The influence of AI begins well before construction starts. Developers can now analyze massive datasets to pinpoint optimal warehouse locations, factoring in regulations, incentives, logistics networks, customer demand, and delivery costs.

AI tools help identify ideal sites for both last-mile delivery facilities in dense urban or suburban areas and for large, regional distribution hubs. For instance, industrial giant Prologis uses AI to evaluate key variables such as port access, transportation routes, and site-specific conditions that impact operational performance.

While Esri and ArcGIS remain industry standards for modeling distribution and transit networks, a wave of AI-driven startups—like CARTO, Spatial.ai, and Deepblocks—are bringing advanced geospatial analytics and visualization tools to companies of all sizes. Meanwhile, platforms such as TestFit, Giraffe (UK), and OutlineAI (Poland) apply AI to optimize building configurations, parking layouts, road access, and zoning compliance—further evidence of the growing accessibility of AI.

Warehouse Automation: A New Era of Robotics

Once warehouses are operational, AI’s influence continues through the rapid rise of automation. Facing ongoing labor shortages, industrial logistics operators are increasingly turning to AI-powered robotics to maintain efficiency and throughput.

Amazon, for example, has introduced six new warehouse robot models over the past three years and aims to automate 30–40% of its order fulfillment processes by 2030. Walmart is following suit, retrofitting grocery fulfillment centers with advanced ASRS (automated storage and retrieval system) infrastructure to boost supply chain efficiency and remain competitive.

According to the report, the number of warehouse robots worldwide—about 479,000 units in 2024—is projected to triple to 1.5 million by 2030. The next generation, known as mobile manipulators, will be capable of navigating and handling objects in complex environments, opening new possibilities for automation in distribution and logistics.

The Bottom Line

AI is poised to redefine every stage of industrial real estate—from planning and site selection to warehouse operations and workforce efficiency. Whether it ultimately increases or reduces overall demand for space remains to be seen, but one thing is clear: the industrial real estate sector is entering an era where intelligent automation and data-driven decision-making will shape its future.

Source: Commercial Property Executive