2 Keys to Warehouse Shopping in 20170

Posted by Thomas Miller, CCIM

miller-industria-properties-leasing-buying-warehouse-2017If you’re looking to lease or buy a warehouse here in northern Nevada or somewhere else, there are a few things to understand right out of the gate. Many people condense the entire process into a single focus – the cost per square foot. That overlooks many, many factors, and one of the most applicable in 2017 is the technology that can be found in today’s warehouses. This technology allows for logistical efficiency and supreme flexibility, two factors that can be game changers. If a new warehouse is in your future, keep in mind these two keys to warehouse shopping in 2017. 

Upgrades, Upgrades, Upgrades

There are standard features in today’s warehouses, and then there are upgrades. These may include but are not limited to:

  • A healthy number of oversized truck docks
  • Oversized trailer and chassis storage courts
  • Crossdocking
  • Eave heights soaring 40’
  • The highest available bandwidth
  • The highest fire sprinkler ratings

In an effort to stay competitive, developers today are routinely including these upgrades. And it makes sense. The death blow to a warehouse can be its odds of becoming obsolete just a few years after it’s built. Ask about standard features, certainly, but inquire as well about upgrades that make a given property far more flexible.

Don’t Overlook LEED Certification

Consider it the ultimate upgrade. Today, developers are reaching LEED silver status certification almost as a matter of course, with Gold an occasional bonus. Yes, there are shortcomings to LEED certification, but it can’t be denied that it has helped produce some of the most energy efficient warehouse ever made available for public use.

And yet.

It’s the rare client who makes a point of asking about upgrades and a building’s flexibility, or about LEED certification, or even about a building’s age. Along with terms and pricing, these should be among the most important questions that a potential buyer or tenant could think to ask.

This is likely because people tend to think in terms of today, and not how things may change in the future. When you pose this as a question, it gives you a perspective that might be incredibly useful. You may not need 40′ eave heights today, but might you possibly need them in the future? Even if your business might not need this feature, might it become a wonderful incentive for someone considering buying your building or, perhaps, your business?

Keep in mind, there is no debate that LEED status brings not only a large tax savings, but lower NNN fees to the tenant, which lowers fixed operating costs. Many of the upgrades in today’s warehouses – new lighting technologies, high-efficiency heating systems, improved wall insulation, LED fixtures with motion sensors, etc. – also provide notably lower operating costs.

The Takeaway

When it comes time to look for warehouse space, don’t pin everything on price per square foot. Ask specifically about a pricing upgrade into those top Class A spaces with their flexibility and LEED statuses. You may well surprise your agent with your understanding, and you’ll likely be surprised yourself with the answers.

Our posts are intended to educate commercial real estate users so they can make better decisions in their real estate use, investments, buying and selling. We encourage your input and commentary. If you are enjoying these posts and finding them useful, help spread the word via Facebook, Twitter, LinkedIn, Google + or email with the buttons above.

About the Author

Thomas Miller, CCIM

Thomas Miller, CCIM is the president and broker of Miller Industrial Properties in Reno, Nevada. He has worked in industrial real estate since 1991, with 15 years of previous experience designing and building industrial warehousing and manufacturing facilities in the northern Nevada market. Contact Tom at tom@mipnv.com or 775-742-9891.

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