When you need to lease warehouse space and are seeking help from a local commercial real estate agent it’s important that you share with them everything about your business, ideal size, location, how you will use the space, any specific warehouse space needs, etc… You see warehouse space comes in many forms and fashions and not all of them are going to be able to accommodate your use. For example some warehouse spaces are located in small business parks that don’t have room for 18 wheelers to get in and out of. The space might be perfect however if you depend on 18 wheeler access then the space won’t work.
To help you find warehouse space easier below are a few questions to ask yourself and then share with the commercial agent that you are working with.
What size warehouse space do I need?
When determining your warehouse space needs make sure you think about your current and future needs. In a tight warehouse space market if you don’t get what you need sooner than later any available space may be gone and you end up having to relocate.
What is my ideal warehouse space layout?
In most cases you may want a little bit or a lot of office space in addition to the warehouse. It’s important to know whether you your ideal layout. Do you want 10% office and the rest warehouse or do you know that you need exactly 1,000 sf of office space and 10,000 sf of warehouse space. Knowing your ideal layout will help your agent find spaces that either have your ideal configuration or that can be made to accommodate your ideal config.
What is my ideal warehouse space location?
What you will find is that most warehouse space buildings are clustered together. You see it’s not feasible to build warehouse buildings anywhere you want because land costs are too high. In addition because many warehouse users rely on shipments coming from and to Austin they like to be close to major highways and airports. In Austin for example you will find most of the warehouse space located in Northeast, Southeast, North Central, and South Austin. There are others sprinkled around in other areas however that is where the bulk is located.
What is my monthly warehouse rental budget?
What is the maximum monthly rent that you can afford? Every warehouse space market is different as some cost more than others however it helps to know what your budget is so your agent does not waste time showing you spaces that you can’t afford. Your commercial realtor will be able to educate you on market lease rates, etc so make sure you ask. In Austin, tx for example average warehouse space lease rates will range from $0.75 to $1.00 gross per month. So if you are leasing 5,000 sf that would be $3,750 to $5,000 per month.
What is my ideal move in date?
Do you need to move in within 30 days or 60 months? Are you flexible? This is key to know as some spaces are move in ready and could be occupied within 30 days. However other spaces may need to be built out they way you want and could take 4 to 8 weeks to do so. Also, in a competitive market if you really like a warehouse location you may have to take a space sooner than later or risk of someone else leasing it.
How long of a lease term am I comfortable with?
In most cases landlords will require 3-5 year leases, especially in Austin, Tx. The more tenant improvements are needed the more likely it will be that the landlord will want a 3-5 year lease. If you can take a space “as is” then you have a shot at getting the landlord to agree to a shorter term lease. You have to think about what makes sense for your business. If a shorter term is desirable there are landlords that will do it, however just keep in mind that it will take a little bit longer to find a space.
Do I need HVAC in the warehouse?
Most warehouse do not come equipped with air conditioning. HVAC costs a lot to install especially if you are trying to condition 20,000 sf of warehouse space. There are some that already have hvac however they are few and far between. They do exist and If that is a must have for your business just keep in mind it will take a bit longer to find the right space. Landlords won’t typically pay the money to install hvac because of the cost and the fact that more then likely the next tenant won’t need it. If they do agree to pay for the installation they will ask for a longer lease term in return, and will want to make sure that you have strong credit.
What ceiling height do I need in the warehouse?
Are you stacking products? If so how high? Warehouse space ceiling heights are typically 16 to 25 feet. Many of the new buildings are even up to 27 feet. It’s important to determine how you will be using the warehouse. If you need high ceilings you must ask up front. When trying to find the perfect space you have to be specific with your needs.
Do I need to park trucks, trailers, or other vehicles over night?
Not every landlord will allow you to park trucks or trailers overnight. And to be honest in some locations you may not want to unless you don’t mind getting stuff stolen every now and then. If you for sure will need to be able to park trucks over night then make sure you know exactly how many you need to park now and in the future. You must negotiate this up front or you will end up having to make alternate plans later on.
How will my products be delivered?
Will you be receiving products via 18 wheeler, box trucks, or other ways? Not every warehouse space has dock high loading or room for 18 wheelers to access so it’s important that you find this out and thoroughly communicate this need to your agent and landlord.
Do I need dock high or grade level loading
Most large warehouse buildings will have dock high loading and maybe also grade level. If you need to lease less than 5,000 sf you will find that most of the options will not have dock high loading. I’m not saying it’s not possible however if you need to lease a small space and need dock high loading it will take you a while to find space. Most small warehouses only have grade level loading.
Do I have any special power requirements?
2 phase, 3 phase, other? If your business has special power needs you need to communicate this to your agent and the landlord. If the space does not currently have the power then find out if it’s possible to have it installed.
Do I need room for an 18 wheeler to get in and out of?
Again most small warehouse parks will not have room for an 18 wheeler to get in and out of. Some do however you will find that most don’t. It’s important to verify this with the landlord and your agent, and physically see for yourself as well.
In addition to the questions above there are other questions you will want to ask the landlord before leasing warehouse space.