Prologis president highlights communities’ ‘anti-warehouse sentiment’

The president of logistics real estate giant Prologis, Inc. (NYSE: PLD) said Wednesday that community opposition to warehouse development is complicating his company’s efforts to respond to the nation’s burgeoning supply chain needs, acknowledging that “it’s just getting harder to build warehouses.”

Speaking at the San Francisco-based company’s first investor day in approximately four years, Dan Letter said that “anti-warehouse sentiment,” which gathered momentum in the post-pandemic period when warehouse demand and corresponding activity spiked, has made it challenging to add supply at an optimal pace. Communities want their goods delivered in a sustainable manner, but they don’t necessarily want the mechanisms to deliver their products — warehouses — in their backyard, Letter said.

Letter suggested to the attendees that rather than embark on another property tour, they should tune in to meetings of local planning commissions, where arguments over the pros and cons of warehouse expansion and the official decisions that come from them are made, to understand the true nature of the industry’s challenges. Letter singled out Southern California, South Florida and New Jersey — all huge growth markets with strong community activism and powerful planning and zoning commissions.

Commercial developers in the logistics segment will need to possess “more resources, patience and know-how” to navigate through the often-stormy terrain, Letter said.