Leasing Warehouse Space? Here's Your Top Considerations as a Tenant
iOptimize Realty?
Tenant Representation, Renegotiation, Right-sizing, Relocation, Economic Development, & CRE Optimization
Identifying the best approach to leasing warehouse space is a critical responsibility for the decision-makers of corporate real estate portfolios. In this complex arena, finding the right warehouse space is a carefully orchestrated juggling act, where multiple priorities demand meticulous attention.
From optimizing storage space to ensuring facilities align with your operational needs, we will delve into the essential factors and strategies that underpin the quest for the perfect warehouse, providing valuable insights for tenants navigating this pivotal aspect of corporate real estate management.
Determine Your Commercial Industrial Space Needs
Warehouse leasing in the last few years has been largely dominated by modern, high-quality facilities that integrate advanced technologies to optimize efficiency and sustainability. Corporate tenants have new priorities across the board and the warehouse space of the past will no longer cut it as rapid technological evolution is domineering the demand for manufacturing space.
The standard for industrial spaces has long surpassed just accommodating storage needs. Tenants want to ensure their warehouse spaces are fully equipped with the features that will put them on top of their competition. And these modern warehouse properties are dominating the modern leasing market, accounting for 68.5% of signed industrial leases in Q1 of 2023.
?So, when you are leasing warehouse space, you need to consider how your perfect space would stand the test of time. Warehouse leases are long term; therefore, you want to balance a property's potential for technological adaption along with other key features like cost and square footage or risk getting outdated.?
Calculating the Cost of Your Warehouse?
Cost will be highly intertwined with a warehouse's technological capability. There is a squeeze for the right properties as every tenant puts emphasis on premium, technologically capable facilities.
领英推荐
And this emphasis on Class A properties has had a direct effect on average rental rates in the market. As anticipated, the average asking rates for leased warehouse spaces have experienced a notable increase because while there has been a dip in overall leasing activity, the higher concentration of leases being signed for Class A properties has driven up the average rental prices per square foot observed in the market.
Beyond property cost, there's a lot of other factors to get right when dealing with warehouse rentals. From getting the right lease terms to the best timeline for move in, becoming prepared is the only option you have to negotiate your optimal deal. Enroll in the free course to learn how to find the best warehouse for the best price.
So, renting warehouse space is getting more expensive, well, it is if you're still utilizing the landlord's broker.?Employing the services of a True Tenant Rep? is the only surefire way to maximize the competition among landlords for your tenancy, boost your leverage, and cut your costs.?
The factors that are going to be first-and-foremost when identifying your leverage in negotiating a base rent include:
When it comes to the total cost of occupancy, it's never just rent. There are numerous other considerations that may be added to your capital expenditures. So, when attempting to cut costs, start by negotiating the factor you can control, base rent. Because other expenses incurred can include CAM charges, rent escalations, property taxes, utilities, service contracts, and estimated operating expenses.