Sub-Property Type Benchmarks

Industrial real estate investors typically spend a good deal of time highlighting the different markets to which they are exposed but rarely focus on the features of the types of industrial properties in which they invest. Our research data and extensive experience show however, the performance characteristics of these industrial sub-property types, (Large Warehouse Space, Research & Development and Small Industrial Assets), vary greatly enough to distinguish the preference of investing in certain industrial sub-property types within specific Target Markets.
These are generally warehouse assets 400,000 square feet and greater, exhibiting modern functionality, aimed at the distribution activities of the national economy with an emphasis on highly populated regions. Warehouse assets generally have parking ratios of less than 2.5 to 1 and less than 10 percent of the space dedicated to office uses and clearance heights of at least 24 feet while these larger assets tend to have clearance heights 30 feet and greater.
Industrial assets aimed at the needs of the technology sectors and/or partial light manufacturing activities are termed Research & Development (R&D) or from time to time “Flex” assets. These assets are typically 50,000 to 200,000 square feet. Other attributes include heights of less than or equal to three stories, at least 25 percent with less than 75 percent of the net rentable area demised or planned as office space or highly improved, and a parking ratio greater than or equal to 2.5 to 1.
These assets are typically classified as local or regional warehouse space though the economic activity supported is not necessarily the shipment of goods but can also involve the manufacture and fulfillment of goods and the associated services therewith. Small industrial assets support firms that manufacture components and act as suppliers for larger organizations. Other attributes of the tenant base include consumer-oriented support services such as plumbing, electrical or auto-repair services, in addition to any other company that needs functional space to support clients and customers within a five to seventy five mile radius. These assets are generally less than 400,000 square feet with the premises often divided to service multiple tenants.