The Best Types of Industrial Real Estate for Beginners
When most people think of industrial real estate, they picture basic warehouses and manufacturing plants. But the reality is this sector encompasses a diverse range of property types you may not be aware of. In this video, I’m going to simplify things and help you understand a little bit about industrial real estate in general and more about the five best types of industrial real estate for beginners.
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Key Takeaways:
Flex space and light assembly spaces are versatile options for beginner industrial real estate investors due to their ability to accommodate various business needs.
Cold storage demand is increasing and it offers stable tenant retention, making it a valuable investment despite potential challenges finding new tenants.
Industrial outdoor storage provides cash flow, versatility, low maintenance costs, and potential for future growth, making it a good entry point for beginners.
About Your Host:
Tyler Cauble, Founder & President of The Cauble Group, is a commercial real estate broker and investor based in East Nashville. He’s the best selling author of Open for Business: The Insider’s Guide to Leasing Commercial Real Estate and has focused his career on serving commercial real estate investors.
Episode Transcript:
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Are you looking to take the next step toward investing in commercial real estate but don't know where to go? Series central offers a comprehensive education and coaching platform designed to help you get started. Our online courses cover a wide range of topics, from the fundamentals to advanced strategies, ensuring you have the knowledge and skills needed to thrive in this competitive industry. As a member, you'll gain access to our exclusive online community and monthly group coaching calls, providing you with valuable networking opportunities and personalized guidance from experienced professionals. Whether you're a beginner or looking to take your career to the next level, cre Central has the resources you need. Visit www dot cre central.com to learn more. So you're stepping into the world of industrial real estate and let's face it, it might feel a bit like navigating uncharted territory. Or wax we've all been in those shoes when most people think of industrial they picture basic warehouses and manufacturing plants. But the reality is this sector encompasses a diverse range of property types that you may not be aware of. In this video, I'm going to simplify things and help you understand a little bit about industrial real estate in general and more about the five best types of industrial real estate for beginners no need for complicated jargon for keeping it straightforward and practical. So let's get to it.
Number one flex space flex space is a versatile industrial property that combines office and warehouse spaces typically ranging from about 5000 to 50,000 square feet. Flex spaces cater to a variety of business needs, making them suitable for small to medium sized enterprises. Now flex spaces are like the Swiss Army knives have industrial properties. They're incredibly flexible, making them ideal for new investors. Why? Well, they cater to a wide range of uses. Whether you're a small business owner or a regional distributor. As a beginner, having the ability to accommodate various tenants gives you some much needed options. Plus, these spaces are in high demand making them a sweet spot for steady income. Think of them as the steady sidekick to stabilize your real estate journey. Fast. Number two light assembly what assembly industrial properties are used for assembling products rather than intense noisy manufacturing. Cotton headed ninny muggins these spaces average between 10,050 1000 square feet give or take and cater to businesses involved in assembling and shipping products with minimal manufacturing processes. They may also include areas for storage and office functions let assembly spaces are fantastic for beginners dipping their toes into industrial real estate. Why? Well, it's less complex than heavy manufacturing yet still offers a taste of the industrial scene, you can explore storage and creative office spaces making it a beginner friendly playground. Number three cold storage cold storage consists of refrigerated warehousing designed to store perishable food and products. These facilities typically range from about 10,000 to 100,000 square feet and they are equipped with HVAC systems and insulation setups to maintain specific temperature ranges. Cold storage is crucial for storing items like groceries and its demand has increased significantly in recent years. This type of industrial space is perfect for beginners for a couple of reasons. First, it's in high demand due to the rising grocery delivery and the quest for fresher products.
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Fewer preservatives and food require more cold storage but there's still a very limited supply of cold storage real estate, which makes it that much more valuable
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as a beginner tapping into trends like this is a good strategic move. Secondly, tenant retention tends to be remarkably high. The headache of relocating an entire inventory of refrigerators and freezers makes tenants which are often grocers more likely to stick around for the long term. This stability and tenant occupancy makes cold storage a hot prospect for beginners working to build a consistent and reliable income stream. On the flip side though, if a tenant does leave, it's not as simple as moving a few boxes. Finding a new tenant can be a bit difficult. It's not like setting up shop and your average office space. These cold storage suites require specialized equipment and infrastructure making it a bit of a unique beast. So the challenge becomes finding a new tenant who not only needs that specific chilly infrastructure. But he's also willing to embrace a space that's already been customized for a previous occupant certainly not impossible, but it might take a bit more time and effort compared to say a flex or generic warehouse number four industrial showroom ever thought about a space that's a mix of retail and warehousing kind of the best of both worlds. That's exactly what industrial showrooms are with an average size ranging anywhere from around 10,000 to 50,000 square feet give or take. These properties provide ample room for both display and store Watch appealing to businesses seeking a balance between retail and distribution. For new investors. This means your space can attract small businesses that make custom goods as well as large regional and national tenants. It's a win win for the beginner who wants to stand out and a showroom of industrial real estate. Think flooring, showrooms, furniture, warehouses, and honestly, retailers like Best Buy space in the front of the building to show off the goods and storage in the back for easy distribution. Last but certainly not least, we have industrial outdoor storage iOS, this involves storing materials or vehicles in an outdoor industrial setting, and it's quite possibly the easiest property to own. For new landlords. The size of these properties varies wildly with some accommodating around several acres of outdoor space average is probably two to three acres but you can certainly go smaller or bigger. They are suitable for businesses needing large outdoor areas to store raw materials, heavy machinery or finished products that just don't really require the expense of climate controlled environments. This outdoor Canvas offers freedom from indoor constraints, making it very versatile for various needs. And as a cost effective entry point for beginners mindful of expenses because it's an open yard with a fence of course its adaptability, minimal maintenance requirements and the potential for diverse opportunities, we get a very attractive choice for beginners. Now what makes it even sweeter for beginners is that this type of property often becomes a cash cow. Until its true potential its higher and better use is unveiled. You get the chance to rake in rental income while patiently waiting for the perfect opportunity to transform that outdoor space into something even more lucrative. Let's do it quick, cheap cash flow and the promise of future greatness. It's like having your cake and eating it too. So if you're all about smart investments and watching your cash flow grow industrial outdoor storage might just be your ticket to the real estate game. So there you have it, folks, five types of industrial real estate that are perfect for beginners. Do you have this video here on how to actually find industrial Real Estate Investments next?
Are you looking to take the next step toward investing in commercial real estate but don't know where to go? Series central offers a comprehensive education and coaching platform designed to help you get started. Our online courses cover a wide range of topics from the fundamentals to advanced strategies, ensuring you have the knowledge and skills needed to thrive in this competitive industry. As a member, you'll gain access to our exclusive online community and monthly group coaching calls, providing you with valuable networking opportunities and personalized guidance from experienced professionals. Whether you're a beginner or looking to take your career to the next level. Cre Central has the resources you need. Visit www dot cre central.com To learn more
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