History has shown that the REITs have favored and purchased warehouses, in Miami, over 100,000 sq. ft.  Jump ahead to 2012 and while some of the larger industrial projects change hands from time to time, there are fewer large warehouses in Miami for these REITs to purchase.

What happens when those 100,000+ sq. ft. warehouses are not available? REITs start taking a look at the 40,000-100,000 sq. ft. warehouses.  Generally, these warehouses are bought and sold by your local business owner.  If you are a business owner and looking to purchase a warehouse of that size, you need to be prepared that you might be going up against REITs bidding for the same property.  These REITs have the advantage in that they can close quickly and their offers are not contingent upon financing.

What can the local business owner do?  The advantage a local business owner has is that they are a user and a user will usually be willing pay a little more than the REIT, as they do not have to report to their investors.  Also, if the local business owner engages a local industrial real estate professional early in their search, they will have the opportunity to hear about warehouses, many times, prior to the institutions catching wind of them.

Our Miami-Dade industrial market is tightening, rates are creeping up, vacancy is creeping down, landlords are giving less away, and REITs are now eyeing smaller warehouses. When it comes time to think about making a move and to be sure you are getting the best value, involve a real estate professional early in your decision making process.

by Chris Spear

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