NYC warehouse bill rattles industrial landlords

A New York City Council bill aimed at last-mile logistics is unnerving industrial landlords, who warn it could drive third-party logistics tenants out of the five boroughs. The Delivery Protection Act, sponsored by Council Member Tiffany Cabán, would require warehouse operators to directly employ their workers rather than contract them out, mandate safety training, and impose a $500 operating license renewable every two years. Introduced in fall 2025 and reintroduced this spring, it has been stuck in committee since April.

Why it matters. New York’s industrial stock is among the scarcest and most expensive in the country, and 3PL operators are the tenants filling much of it. Owners argue the mandate would raise costs enough to push those users to New Jersey, hollowing out demand for space that took years and heavy capital to build. A report by planning consultancy AKRF estimates the bill could cost between 3,000 and 10,000 jobs.

The numbers. The chilling effect is already visible: CBRE data cited in the reporting shows the city’s industrial construction pipeline has shrunk 69% to about 467,000 square feet. Prologis alone holds roughly 1.2 million square feet of NYC industrial space. “If operators begin to exit the market or decline to renew leases, that investment is unlikely to materialize,” said Jeremiah Kane, a senior vice president at Prologis.

What’s next. The bill remains in committee with no scheduled vote, but landlords say the uncertainty itself is enough to stall new starts. For a market where policy increasingly sets the ceiling on New York development, the Delivery Protection Act is a test of how far the city can push labor standards on warehouses before the space — and the tenants — move across the Hudson.