• Industrial

Research Spotlight – The Evolution of Warehouse and Distribution Center Design

Evolution of Warehouse and Distribution Center Design

If You Build It (With Functionality), They Will Come

by Jolanta Campion and Jared Jacobs

Ensuring that a warehouse or distribution center has the functionality required by industrial occupiers is critical to minimizing lease-up time, maximizing rents, maintaining occupancy, and competitively positioning the building for future leasing and investment. This is made more complex as distribution models for national retail tenants—and the third-party logistics firms that support them—rapidly evolve in response to eCommerce fulfillment. Although supply chain strategies are as varied as the retailers who pursue them, it is clear that logistics is becoming a revenue driver with high-velocity distribution centers increasingly considered strategic assets capable of enabling ever-tighter delivery commitments. It is also evident that newly constructed warehouses and distribution centers are growing larger and taller. The average footprint and clear height of logistics product has increased steadily over the past 20 years. In addition to larger storage capacity, tenants are seeking other modern design features and expanded functionality, as evidenced by leasing of newly constructed and build-to-suit product delivered in the past 24 months, accounting for nearly two-thirds of net absorption.

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JOLANTA CAMPION
Director of Research, San Diego Region

JARED JACOBS
Research Manager, Philadelphia

 

 

  • Industrial

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