considering whether they overestimated how quickly their first-mile warehouse needs will increase . This is a bad combination for big-box warehouse shares . Prologis shares have been down about 37 % since late April , and they fell another 8 % recently .
According to the Wall Street Journal , Ikea , the Swedish furniture giant is doubling down on its fulfilment capabilities by investing over $ 3 billion to revamp the company . This overhaul will include transitioning up to 40 % of its existing bigbox suburban locations into smaller last-mile distribution centres for online orders . By redistributing how their space is utilised , the company hopes to optimise their real estate portfolio and bolster their delivery capabilities
instead of increasing the footprint of existing stores .
The last mile of the delivery chain is proving to be the most valuable one for industrial properties . Facilities that can accommodate the everevolving demand of retailers for much quicker deliveries are proving to be the downfall of the big-box warehouse and opening new doors of opportunity for reimagined last-mile logistics solutions .
Real Levitt Chief Executive Officer INOSPACE
SA Real Estate Investor Magazine AUGUST 2022 137