Commercial Real Estate News / Development / Understanding What Turns Warehouses from Trash to Treasure

Understanding What Turns Warehouses from Trash to Treasure

Published: 02-22-22 Category: Development

Specializes in providing actionable insights into the commercial real estate space for investors, brokers, lessors, and lessees. He covers quarterly market data reports, investment strategies, how-to guides, and top-down perspectives on market movements.

Warehouses cycle in and out of popularity as real estate trends come and go. Indeed, a lot of people used to turn up their noses at the idea of pursuing warehouse leases. After all, “warehouse” and “seedy” were often paired together in the minds of many.

Of course, this stereotype does have a grain of truth: in many markets, warehouses are part of run-down industrial complexes, with broken windows covered in dirt and grime.

Thankfully, many cities have launched revival projects, especially as the pandemic has left plenty of vacancies. Things are still uncertain, but plenty of local government and council members are looking at reducing vacancies to get the economy moving again.

In comes the warehouse, the cool kid on the block all over again, but there is something that turns warehouses from trash to treasure.

Take Advantage of Boston’s Long Industrial Heritage

The right area makes it easier to pursue leased warehouse space, and there is something truly special about the greater Boston area. It is a place where history and modern amenities intersect, and the city has never shied away from its deep industrial background.

Warehouses are versatile and useful in a wide variety of applications, but they are definitely in the industrial category. Finding warehouse space for rent in Boston is ideal for several reasons, including a wide range of inventory. It’s a straightforward type of property with landlords focused on building win-win partnerships with tenants.

Versatility For a Wide Range of Projects

Warehouses are truly a great way to test concepts, enter a market slowly, and measure the impact of your ideas on the community. A lot of people new to commercial real estate often wonder where to get started.

Leasing a space like a warehouse can be fairly low-risk and a great way to test an idea, like building a small storage facility for a specific audience.

For example, if you’re getting deeper into the e-commerce space online (which is only continuing to grow), leased warehouse space lets you grow the online business without having to tie up capital in purchasing a warehouse for this purpose.

Overlooked Aspects of Warehouses for Rent

The difference between a good experience with warehouses for rent and a not-so-pleasant one is not having key information that allows you to make a solid decision. Here are a few points to keep in mind:

Maintenance. Who is truly responsible for the maintenance of the building? Remember that updates to the building raise its value, which means that’s money out of your pocket and into the property owner’s pocket instead.
The parking area. Good parking isn’t just for your customers; if vendors and employees can’t access the building well, it creates long-term problems that are better avoided.
The real operating expenses. For example, how much is it to heat and cool the space? How do those costs play into the plans you have for the warehouse?
The lighting. One of the major differences between good and great warehouse space is the internal lighting. Bad lighting makes it harder to see and focus on the work at hand. Sure, you can add more lighting, but it’s better to know what you’re working with first.
Existing appliances. Is there an HVAC system on the premises already? If so, is it in good working condition? You can’t know the true condition of systems already on the property, but you can make sure that you understand who pays for these on-site items.

Before you commit to a new lease term, it’s important to ask as many questions as you need to ensure that you’re walking into a situation that forms a good foundation for your upcoming project.

Measuring Usable Warehouse Space

In order to measure the value of any warehouse for rent in Boston, it’s important to understand the concept of usable space. That’s what you are ultimately paying for every month with the rent, so it’s good to see what you get in exchange for the money.

Usable space requires decision-makers to not just rely on the total square footage of the building, but to remove the space that isn’t usable. This would include loading areas, bathrooms, office space inside the warehouse, and anywhere else that can’t be directly used for storage purposes.

In addition, it isn’t just the width of the space, but also the total height with modifications set aside for the overhead objects. This is referred to as the clear height and definitely affects how high you can store items in the warehouse.

Warehouse Zoning in Boston

Boston’s zoning laws could be their own article, but we’ll try to give you a quick rundown. Like in most major cities, there is an entire department just for planning and development, which would include examining zoning procedures.

There is a zoning map that you can use to check out to see what zone every property is in. Although the focus here is on warehouses for rent instead of purchase, it’s never a bad idea to consider future opportunities to purchase.

What if the flex space that you rented for a venture turns out to be wildly successful? It can make a lot more sense to purchase a leased property after testing the space instead of just buying it from the beginning. Weighing the decision to lease vs. buy is often difficult and very dependent on the unique characteristics of the deal in question.

The Road Ahead

Warehouse space is flexible, affordable, and growing in popularity as people across the commerical real estate spectrum see how easily they can turn into more interesting spaces.

As technology continues to transform our society, warehouses will become the bread and butter of the commercial world. It’s bound to happen given that they’re so flexible, and so many areas have plenty of inventory to go around just sitting vacant.

As far as warehouses for rent in Boston go, it’s a great idea to pour through the listings, see what space would work best for the plans you set up, and then go from there.

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