When it comes to real estate investment, the Northeast Ohio area is not lacking in warehouse space. It’s not a secret that the pandemic has led to some major retail stores closing their doors, causing a shift in the need for retail space to a need for other types of commercial spaces such as warehouses.
Opportunities: Warehouse Demand is Up
Many retailers seek to shift their focus from physical stores to online sales, and for good reason. Doing so is more cost-effective than sustaining brick-and-mortar locations. It also allows them to reach out into new markets they may have never been able to before due to technological advancements like smartphones, that make ordering products easy at any time or place.
Fortunately for investors looking to capitalize on this trend, there’s a new industry that has emerged: commercial warehouse space. These functional buildings provide retail supply chains with storage space to continue running e-commerce businesses without worrying about where their inventory is being stored or what will happen when these spaces become overcrowded as more people start buying things from home rather than in person at physical retailers.
Warehouses tend to be relatively low-maintenance properties, focusing on storage and efficiency more than aesthetics. Warehouse tenants may be more inclined to sign longer-term leases in the coming years. Industrial warehouses offer a higher ROI than office or retail space. With so many online shoppers purchasing goods unavailable to them locally and retailers desperately trying to keep up with demand, it’s no wonder that this type of property has become popular. As such, warehouses offer a lot of upsides.
Investing in warehouse real estate can be much more than just storing goods. There are many space conversion possibilities, such as turning them into production sites, or office space for businesses looking to expand their operations. Despite the economy’s temporary setback and the housing sector struggling to gain traction, warehouse space is in high demand.
Barriers to consider
When weighing the decision to invest in this type of commercial space, it is crucial to consider all of the relevant factors, such as:
- Warehouses typically come with higher upfront costs and larger down payments from banks due to their increased risk level than other commercial properties.
- When an industrial tenant vacates, finding new warehouse tenants often takes longer than finding new retail or office tenants.
- Technology changes quickly. Therefore, outdated buildings that cannot meet these changing demands may become obsolete.
If you’re considering investing in warehouse space for business purposes, it’s good to know what your options are in the Northeast Ohio area. Whether you need a 10,000-square foot industrial facility or just 1,500 square feet of office space with loading docks and parking spaces, we can help. We have connections throughout the Greater Cleveland area that will allow us to find exactly what you’re looking for based on the price range.
For more information, contact us today!
To learn more about how CRESCO, Greater Cleveland’s leading commercial real estate company, can help you with your property needs, contact us at 216.520.1200, or fill out the form below. A CRESCO professional will contact you shortly.