Pushing Dirt

If you’re new to commercial real estate investing, consider making industrial real estate a focus. I did, and I don’t regret it. Why?

1. It’s not where “the others” are focusing. It doesn’t have the glamor of downtown office product It’s dirty. So there’s less competition all around.
2. It’s much simpler to learn. You don’t have to lean what a natural break point is, or a gross rent multiplier. You’re renting four roofs and a wall and some doors. You can be up to speed very quickly on market rents because it’s much or of a commodity.
3. It’s less volatile. Rents don’t swing as dramatically up or down. Nor does vacancy. I’m not saying that there isn’t risk associated with industrial product, but you will never see the phenomenon we are seeing in retail right now hundreds of stores closing, all across the country, all at once.
4. It’s easy to underwrite. There are only two major capital items that need attention in most industrial buildings: the roof and the pavement. Once you understand their condition, you’ve got a handle on how much to set aside in a capital reserve over the next 5 to 10 years.
5. You can dress casually :). Generally whether you’re canvassing, meeting tenants or owners or brokers, you’re going to find a lot fewer people wearing suits and ties.

Did you enjoy this post? Subscribe at the right and receive more like it by email or RSS feed.

37,000 square foot warehouse for sale or lease; can be divided down to 5,000 sf units.

In Kenilworth Industrial Park just off or Route 50, two blocks to DC border in Maryland.

Gated fenced highly secure project.

Ideal for food uses being pushed out of DC or any warehouse use needing easy access to MD, VA and downtown via Routes 50 and 295.

Email for a flyer and more details on this offering. To receive details on other opportunities like this one, enter your email address in the field to the right!

One way to create value in an industrial building is to consider a roof raise. A dated 14′ clear might sit empty for years while 30′ clear and up buildings all around it fill up.

You don’t even have to do the roof lift speculatively. Space Technology Inc. will gladly take your building specs and formulate a quote to raise the roof. In fact, they will do this with every building in your portfolio in the hopes that one of these quotes will turn into a job someday. You can take the bid and market that 14′ clear building as a state of the art high cube building.

Not all warehouses are good candidates for the process, and expect the price to come in at $10 per square foot or more.