Across the country, companies are rethinking their supply chains, shifting operations closer to customers, and hunting for the kind of flexibility that enables smarter logistics. In San Antonio, that recalibration is playing out in a very specific way: rising demand for mid-sized industrial buildings—particularly around 10,000 square feet. For many businesses, these spaces represent a strategic sweet spot: large enough to support growth, but nimble enough to adapt to uncertain market conditions.
Local Drivers with National Echoes
Historically, demand for 10,000-square-foot industrial facilities in San Antonio was dominated by local and regional players—small business owners graduating from leased space to property ownership. These users see real estate as a way to stabilize costs and invest in their own growth. But today, there’s more complexity at play.
“Over the past 12 months, demand has actually slowed a bit,” remarks Colton Perkins, Vice President with Stream’s industrial team. “But that’s more reflective of macroeconomic uncertainty—tariffs, elections, interest rates—than a fundamental change in the long-term trajectory.”
Even as some buyers pause on major decisions, structural forces continue to shape the sector. San Antonio’s population boom creates new rooftops to serve—and in turn, demand for light industrial facilities that power the businesses doing the serving.
“These groups often start out in a garage or a 2,000-square-foot flex space,” explains Andrew Katzfey, also a Vice President with Stream’s industrial team. “When they scale up, 10,000 square feet feels like a huge leap—and it is. But it’s also exactly what they need to take the next step in their business.”
National Users, Local Hubs
It’s not just local entrepreneurs fueling this demand. Stream also sees regional and national tenants seeking smaller footprints in secondary markets like San Antonio to get closer to their customers. “There’s a clear trend toward regional distribution hubs and being near the end user,” Perkins comments. “That’s what’s making these smaller spaces attractive—even for larger companies.”
That insight aligns with broader national data pointing to a “hub-and-spoke” model in logistics, where companies rely on a network of smaller, strategically located distribution centers to reduce delivery times and manage inventory risk. It’s a model well-suited to a market like San Antonio—especially when proximity to Mexico is factored in.
Onshoring, Nearshoring—and Uncertainty
San Antonio’s position along key trade routes with Mexico adds another dimension to its appeal. As global tensions rise and trade policy becomes more volatile, manufacturers and distributors look to hedge against risk. That makes nearshoring—bringing production closer to the U.S.—and onshoring—moving it stateside entirely—more attractive.
“We have a building under contract right now to a group that operates in Mexico,” Katzfey reveals. “They want to establish a U.S. footprint to diversify their exposure. With all the uncertainty, having a base here is just smart risk management.”
While it’s difficult to predict how future tariffs or trade policies will shake out, Katzfey believes San Antonio is well-positioned to benefit either way. “As the U.S. strengthens trade ties with Mexico, we can expect increased volume through Laredo—and rising demand for industrial storage in San Antonio as goods move across the country.”
Still, uncertainty remains the dominant theme. “That’s the billion-dollar question,” Perkins reflects. “If you’re reshoring, do you stop in San Antonio—or go all the way to Nashville? No one really knows yet, but we’re watching it closely.”
Stream’s Strategy: Full-Coverage, Flexible Delivery
What sets Stream apart is its comprehensive, agile approach to this segment. With a team of eight industrial brokers in San Antonio alone, the firm is uniquely equipped to cover the full spectrum—from 2,000-square-foot flex units to 500,000-square-foot distribution centers.
“We work in teams and share information across accounts,” says Katzfey. “That way, if a tenant doesn’t fit one property, we can immediately redirect them to another that works. Our market share gives us a bird’s-eye view of every deal happening in this size range.”
Currently, five of Stream’s eight industrial brokers focus on the 2,000 to 20,000 square foot “shallow bay” segment—leasing a combined 2.5 million square feet of product across the San Antonio metro. That critical mass allows them to build a robust, data-backed understanding of what tenants want, how investors are thinking, and where opportunities are emerging.
“We’re essentially creating a matchmaking network within this size range,” Perkins states. “That gives our clients an edge—whether they’re looking to lease space, acquire it, or develop it from the ground up.”
The Road Ahead
While the next 12 months may be defined more by caution than by a bull market, Stream’s team is optimistic about the long-term health of the 10,000-square-foot industrial segment.
“As the world continues to change—whether it’s trade, e-commerce, or consumer expectations—flexibility will remain king,” Perkins concludes. “And these buildings offer the kind of versatility companies need to adjust without overcommitting.”
That’s a message investors are starting to hear loud and clear. In a time when scale can be a liability and uncertainty is a given, the humble 10,000-square-foot warehouse might just be the smartest play in the industrial game.
