Old commercial warehouses in the New York metro area, once
considered obsolete, are now part of a hot leasing market as logistics
companies fight to win the “last mile” race. Class-B, -C, and –D industrial
space in and near the city is being snapped up by companies needing to
pre-position product as close to consumers as possible. The ability to move
product over the last mile—from warehouse to consumer—faster than anyone else
is creating hot demand for New York City warehouse space.
The consumer expectation that they can “get it now” is
fueled by highly competitive internet and mobile e-commerce growth that shows
no sign of slowing. This revolution in retail has created a revolution in the
New York commercial warehouse market. Once not so long ago, warehouses were
sited out beyond the exurbs where land, labor, and taxes were cheap. Today,
urban “infill,” “last touch,” and “last mile” facilities are driving up lease
costs for nearly any kind of space that can work as a commercial warehouse in
One commercial real estate expert quoted in National
Real Estate Investor said: “Every sub-market is constrained for
product. It’s safe to say that any user with an expiring five-year lease is
looking at sticker shock to renew, with rents at least 25 percent higher than
they had been paying.”
The dynamic is particularly acute for last mile commercial
warehouse space in New York, where the topic was covered in the New
York Post. Amazon upped the ante by transforming prime Midtown
office space at 7 West 34th Street at Fifth Avenue into a local distribution
warehouse. Other retailers are following suit. Cushman & Wakefield is
quoted as saying commercial warehouse space in the city is at “century highs.”
If customers expect delivery in under and hour, shipping from a warehouse down
on I-95 in New Jersey isn’t going to cut it.
Spaces previously not considered for warehousing are being
converted for logistics uses. For example, the Bronx ABC Carpet building in New
York has been retrofitted and are being touted as industrial distribution
centers. Big box retailers like Walmart now see their properties as more than
just stores, putting them to double duty as e-commerce distribution centers.
With demand so hot, working with a local specialist in commercial warehouse rental properties that knows where to find non-traditional space has become more important. Especially in New York, with the stakes are high, a partner like One Stop Spaces can make the difference.
The major trends that drive the commercial warehouse market
in the United States are amplified in the New York region. The size of our
market, its position as a global business center, and the population density of
the New York Metro Area give such trends greater impact here. That affects
warehouse rental prices and the price of every warehouse for rent.
New York Commercial
Warehouse Market as a Trend-Setter
Commercial warehouses were some of the first buildings ever constructed
in New York City. From the city’s earliest days as a trading settlement to its
status now among the world’s busiest ports, New York has been the site of commercial
warehouses of every kind. New York City
has always been a trend setter in the commercial warehouse market.
Warehouse Rental: Four
New market dynamics are driving your choices and the price
you can expect to pay for a warehouse for rent. Here are the top four trends:
- Synchronized Commerce. Today’s consumer demands a near endless variety of products be immediately available at the convenience of a mouse click. The impact of this trend is greatest with the “last touch” and “infill” warehouses that are close to or within population centers like New York. Space has always been at a premium in this commercial warehouse market. Today that premium is steep and growing steeper.
- Tech Enabled. The relentless drive for efficiency is powering the adoption of technology in nearly every corner of the warehouse. From big data analytics and predictive modeling to robotics and automation, commercial warehouse space in New York is going high tech.
- Urbanization. More Americans are living in cities than ever before. More Americans living in population clusters fuels congestion and rising prices—and that impacts your choices when looking for a warehouse for rent.
- Multi-use. The use of warehouse space for hipster offices, tony galleries and hot nightclubs has been going on for decades. What is new is that the e-commerce revolution has flipped multi-use warehouses in New York on its head. Demand for warehouse rentals is so high that non-traditional spaces are being turned into warehouses in a “creative sourcing” trend. Empty big box stores, open office space, parking garages, and even an abandoned military facility in Bayonne have become warehouses for rent.
One Stop Spaces lists commercial warehouse rental properties that span the commercial warehouse market options. We have your trendy office space, your historic sites, and many, many options for commercial warehouse operations.
From close to ports and transportation junctions to “last mile” locations, One Stop Spaces can provide with choices and can facilitate your logistics strategies.