Industrial real estate, sometimes referred to as warehouse property or industrial properties, is a lucrative branch of commercial real estate. Industrial real estate is made up of the following categories of buildings:
- Manufacturing facilities
- Storage buildings
- Warehouses and distribution facilities
Essentially, industrial properties are solely dedicated to the above activities but on occasion, some of them have some minor office space as part of the building. It is however common to find entire warehouses being put to non-industrial use such as gyms, schools and colleges, soccer practice, night clubs, television broadcasting, dance studios, offices, telemarketing, etc. According to the Urban Land Institute, industry is defined as “the gainful activity involved in producing, distributing and changing the form of raw materials, or assembling components and parts, packaging, warehousing, and transporting finished products.”
Investing in industrial properties is a less demanding type of property investment. It eliminates the hustle of dealing with tenants. Most investors who prefer time spent managing their investments, as opposed to managing their properties, seem to prefer to invest their time and money in industrial real estate.
For any investment in industrial properties to be successful, there are four principal requirements:
Accessibility to major transportation routes
Industrial properties need easy access to freeways, heavy-duty local roads, national airways, ports and railroads.
Availability of Utility Services
Industrial properties require utility services designed for heavy work. These include sewers, high voltage electricity lines, natural gas and water supply.
Appropriate Zoning
Industrial properties are subject to very strict zoning restrictions such as their use and effects on the neighboring environment. The rules get even more elaborate when they are close to residential areas.
Availability of Labor
Industrial properties have very specific labor requirements and any industrial property requires the availability of the corresponding skilled manpower whether it is involved in light or heavy manufacturing, research, distribution of lumber operations. The availability of labor goes hand in hand with the availability of social amenities such as schools, health facilities, restaurants, and transportation as well.
In the Miami area, there are a number of industrial areas where these types of properties tend to be located. We profile these in an article, Miami Industrial Parks, complete with Google Maps embedded for easy navigation.