If there was any doubt about the boom in e-commerce, Amazon (NASDAQ:AMZN) just put that to rest.

The online retailer posted 40% sales growth in the second quarter, representing a $25 billion increase in revenue, with sales from its North American e-commerce division jumping 43%. Amazon is one of the biggest companies in the world, and that surge shows just how much demand for e-commerce has accelerated during the crisis.

For Amazon, the timing was fortuitous, as the company had excess capacity reserved for the expected spike in holiday sales, and was, therefore, able to ramp up to meet demand from both customers and its third-party marketplace sellers. However, the second quarter is normally Amazon's slowest, and it will lose that benefit of excess capacity as the holiday season moves closer.

In order to meet that demand, Amazon is focused on adding new warehouse space, and it said it was aiming to grow its fulfillment center square footage by 50% year-over-year, following just a 15% increase last year. However, the company could face some capacity constraints in the coming months if demand remains elevated because of the pandemic, and the same is likely true with other e-commerce businesses experiencing abnormal demand. Among other scarcities during the pandemic, you can now add e-commerce warehouse space to the list.

Trucks parked outside of a warehouse

Image source: Getty Images.

The e-commerce logistics leader

For investors, this mismatch between supply and demand offers an opportunity -- demand for e-commerce warehouses should continue to grow, especially heading into the holiday season. One company that looks set to benefit from this trend is Prologis (NYSE:PLD), a real estate investment trust (REIT) and the global leader in logistics real estate.

Prologis has 963 million square feet of warehouse space in 19 countries, and Amazon is its biggest customer, contributing 5.8% of its net effective rent and occupying 17 million square feet. Among Prologis's other top customers are Home Depot, FedEx, and UPS.

So far this year, Prologis has seen significant momentum in e-commerce. The percentage of new leases coming from that industry spiked to 40% in the first quarter before normalizing at 24% in the second, and in the 30 days before releasing its July 21 earnings report the company signed leases for 16.3 million square feet, representing a 24% increase from a year ago. Rent collections have been strong, sitting at 98% in June, and funds from operations (FFO) excluding promotion income rose from $0.77 per share in the second quarter to $0.88. Prologis also raised its guidance for the year, calling for core FFO per share of $3.70-$3.75, up from a previous range of $3.55-$3.65, and a 12.5% increase from a year ago, a brisk growth rate for a REIT.

Though management noted Amazon ramping up its warehouse needs, it also said that demand for space has been broad-based, coming from home improvement, appliances, and food and beverage, among other categories. Prologis also made a pair of acquisitions at the beginning of the year, which added roughly 150 million square feet and have since proven to be well-timed. Further acquisitions are a possibility, as the company has $4.6 billion in liquidity and expects more than $1 billion in free cash flow after dividends this year.

What the market thinks

E-commerce stocks like Amazon, Etsy, Shopify, and Wayfair have surged this year as e-commerce sales have spiked during the pandemic. However, Prologis has gained just 17% year-to-date, enough to outperform the broad market but much slower growth than the stocks of the e-commerce retailers themselves.

Those stocks have soared because investors believe that the gains that e-commerce sellers have made during the pandemic will stick even after the crisis is over. Asked about that on the recent earnings call, CEO Hamid Roghadam said, "I think we're very early in the roll-out of e-commerce. E-commerce started the year in the low teens in the U.S. The numbers vary in different places. And there is no telling how far it can go. If it goes to 20%, 25%, which is where it was at the beginning, early stages of COVID, or stabilizes ... higher than that, this could be very, very early in the e-commerce roll-out." He added, "And as you know, e-commerce has a sort of a supercharged effect on logistics demand."

If those e-commerce investors and Roghadam are right, Prologis may just be at the beginning of an unprecedented surge in demand for warehouse space. If that happens, Prologis could be the next e-commerce to stock to take off.