Leasing Warehouse Space Versus Owning Warehouse Space?

Renting commercial real estate

You own your own business. You started off small, working out of your basement or a spare office in your home, but your business has grown so much that you have decided it is time to move the business out of your home. Now what? Do you purchase an office space, when you are still a relatively new business? Do you rent the space from someone? Will renting allow you to make the necessary customizations to the office and warehouse your products and inventory? There are a lot of questions when it comes to finding the perfect space for your small business. In short, leasing is a great option for those businesses that are newer and are still working on their profits.
4 billion square feet of warehouse space was built between 1990 and 2003. Leasing is a popular choice amongst businesses, because of the lack of commitment that is often required of owning an office. Leasing commercial property allows the business owner to focus on the month to month, rather than the long term. Focusing on the long term can be difficult and anxiety producing for a company that is still in its newer years.

Many commercial leases will even allow there renters to customize their leasing commercial property space. This is often essential for many businesses. A business that sees clients in a medical type setting will not benefit from having a large warehouse or inventory space included in the leasing office space. On the other side, a company that ships a lot of items all around the country and must have a commercial warehouse to keep inventory of their products will not benefit from leasing an office that does not have the option of leasing a warehouse. Leasing commercial property can be a great option for these business owners to figure out how much space they need. If you have to simply purchase a building before your business is completely established, you would have to estimate on the sizing and inventory requirements of the space.

Retailers online and offline will need a combined 25 million square meters in additional space over the next 5 years to store and handle the stuff they sell. Leasing commercial property allows them to learn about their spacing needs. Purchasing commercial real estate can provide large losses to a business owner if they purchase a space, and later find out that it was either too little or too much space than what they really need.

E commerce is expected to grow at a compounded annual average rate of 10% over the next 5 years, creating tremendous opportunities for owners and developers of warehouse and distribution space. Those who are looking to invest in commercial warehousing spaces will find a huge demand over the next few years. Internet commerce is just beginning to take off and it will only increase with the coming years. As people continue to navigate towards the internet for shopping needs, smaller businesses will find an increase in warehousing space and larger office spaces a requirement for their businesses. They will not want to purchase a commercial property until their business is better established, leaving a huge demand for commercial office leases.

When a company that works out of its home grows in business size, they will find a need for commercial space. Purchasing commercial space can be risky until they have the ability to figure out the true success of the company. Often, it is a better move to first lease commercial space, especially when warehousing is needed. It can be difficult to determine the appropriate amount of needed warehouse and inventory storage space. Leasing allows a less risk option for finding out that information. Owning commercial lease spaces is also a great investment for many, as the E commerce projections are expected to continue to rise.

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