When it comes to warehouse space, it’s always important to consider the specific commodities that will be stored. It’s also crucial to understand the lease terms and conditions. For example, warehouses typically use triple net leases that require tenants to pay building maintenance costs, property taxes and insurance. Understanding these costs upfront can be beneficial when negotiating with potential landlords.
Getting the right warehouse rent for your business isn’t easy. Demand far outpaces supply, and coming to an agreement on a warehouse rental can be a lengthy process. However, the results are well worth it. When done correctly, a warehouse rental can offer your brand the ideal location to reach your targeted audience.
Warehouse Renting 101: A Comprehensive Guide to Securing the Right Space
The logistics sector has seen a dramatic increase in rents in the past few years, and warehouse space is particularly hot. Last year, the Greater Washington market saw warehouse rents rise 23.5%, the fourth-fastest in the world, according to data from industrial real estate developer Prologis Inc. That growth far outpaced the 15.4% global average rent increase, which was driven by rising fuel and logistics costs.
When considering a warehouse rent, the first step is to determine the number of square feet you need. Once that’s settled, the next step is to calculate your monthly cost. Most landlords of industrial and warehouse spaces will ask you to pay a base rate plus NNN or CAM (see our article on Understanding Commercial Lease Rates for more information). In addition, you’ll need to factor in the cost of electricity usage.
