Lease signings for big-box facilities–those greater than 1 million square feet — fell 36% in the second quarter over the 2022 period, according to data from real estate services firm CBRE Group Inc. (NYSE: CBRE) published Friday. This triggered an 18% decline in total industrial space leased during the first six months to 373 million square feet, CBRE said.

Year-over-year declines were seen across the entire big-box space. Leasing activity fell 29% for buildings between 300,000 and 700,000 square feet. Leasing dropped 28% for buildings between 700,000 square feet and 1.2 million square feet. Activity dropped 46% for facilities larger than 1.2 million square feet, according to the data.

Overall leasing activity dropped to 373 million square feet in the first half, CBRE said.

The average size of the top 100 transactions in the first half was 789,471 square feet, well below the 926,683 square feet recorded in the first half of 2022, CBRE said.

Small facilities — those 25,000 square feet or less — was the only market segment to show growth. Those facilities are usually occupied by small businesses with much different needs than businesses vying for big-box capacity.

The data quantifies widespread commentary that big-box demand has been hit by economic uncertainty and waning occupier demand to hold large amounts of inventory, according to Amanda Ortiz, CBRE’s industrial and logistics research director.

Still, Ortiz said the market is stronger today than it was in 2019, with current numbers an indication that the market is normalizing after two to three years of pandemic-induced frenzy for large swaths of warehouse space as supply chains buckled, e-commerce demand soared and businesses took on large commitments to hold buffer stock.

“We are still in a better position now than in 2019,” she said.

Subleasing activity remains strong as tenants look to shed space they don’t need, according to Ortiz. There has also been a pickup in subleasing among tenants that recognized they had too much space even before they occupied it, she said.

Lease renewals accounted for 36 of the top 100 transactions in the first half, more than doubling the level of 15 the same time a year ago. The spike in lease renewals indicates tenants’ caution as they would rather stay in their current locations and possibly negotiate better deals with landlords than pursue new transactions, CBRE said.

Chicago led all markets with 11 of the top 100 leases. It was followed by Dallas-Fort Worth, California’s Inland Empire and Pennsylvania’s Interstate 78/Interstate 81 corridor, each with nine. The “General Retail & Wholesale” industry comprised 34 of the 100 top leases, followed by third-party logistics firms with 33. E-commerce retailers accounted for seven of the biggest leases, down from 14 in the first half of 2022.