Warehouse Space Case Studies



Challenge

  • Chemical Research & Licensing (CRL) required an investment grade distribution facility at below market rates in proximity to its plant along the Houston Ship Channel. The market for space in the size range contemplated was tight.

Strategy

  • Identify buildings in the appropriate submarket that provide both an economically viable deal and a sufficient quality to protect millions of dollars of inventory. Specifically, leasesquarefeet.com leveraged what differentiates real estate deal making at properties owned by Real Estate Investment Trust, Pension Funds and individuals to drill down to a handful of appropriate facilities.

Result

  • CRL leased space from a publicly traded REIT seeking to reduce vacancy and increase immediate “funds from operations” (a REIT valuation. metric) at the expense of future property valuation the rate achieved was 20% below rates quoted at comparable buildings in the submarket.

 


Challenge

  • Mid America Overseas (MAO) received a proposal from its landlord to renew its 13,000 square foot lease at a rate of 35% higher than the rate negotiated in its initial lease term.

Strategy

  • Capitalize on the fact that MAO’s building was part of a portfolio to be sold that could ill afford to lose tenants. MAO reviewed and the landlord was made aware of several alternatives that satisfied MAO’s requirement creating uncertainty with the building’s owner.

Result

  • Landlord capitulated. MAO renewed its lease at rates 15% below its initial term’s rental rate, secured tenant improvements that were not previously available and capped its annual operating expense growth exposure.

 


Challenge

  • Exel Transportation sought to relocate to increase the profitability and efficiency of its operations. Its facility had too few dock doors and was too far from transportation arteries.

Strategy

  • Canvas the market to identify all buildings, not just standard distribution facilities, with minimal bay depths to support the maximum number of dock high doors yet at rates that would not wipe out the resulting saving from a more efficient operation.

Result

  • Leasesquarefeet.com located a 23,000 square feet dock high, rear load building with twelve dock doors, immediate proximity to Houston’s freeway system and negotiated a competitive rental rate satisfying all of Exel’s requirements.