Commercial Real Estate Brokers – The Golden Rules to Creating an Industrial Property Checklist

Many commercial real estate brokers at the start of their career will get involved with selling and leasing industrial property.  It is in most cases the property segment that is the easiest to understand and transact.  In most towns or cities, many local businesses are regularly looking to move or expand given pressures of business activities; so there is some ‘churn and change’ to tap into and service.

Industrial Opportunities Exist

The tenants in the local property market and the investors are always prime targets for your prospecting activities and focus with new business.  You can create an inventory of prospects covering local businesses and property investors, and then make direct contact in an ongoing way.

You can fill your database with those people and businesses understanding what they are looking for and what they require when it comes to local property occupancy and ownership.  Create plenty of personal contact as part of that process so that trust and relevance builds over time.  The listings that you want will be largely found in the personal contact process.

Get the facts

There are certain things that you can and should explore when working with and in industrial property today.  Every tenant or business will have certain special needs to be identified.  Every property will be unique.  Every landlord will have specific factors of negotiation to merge into your property discussions.

So you are the equation to understand and balance all of these requirements professionally; a lease or a sale can be the result.  It’s time to lift your professional skills in working this segment of the market.

Create Your Checklist

Here are some ideas below to help you create an industrial property worksheet to be used as part of industrial property sales and leasing services.  You can add different categories to this process so that the worksheet becomes very special and unique to your professional interaction with tenants, investors, and landlords.  Here is the list to get started:

  1. Precinct and proximity – Where is the property located and how special is that when it comes to industrial business and manufacturing? Some businesses prefer to be an established industrial precinct.  That will then help them when it comes to a daily operations and business function.  Any industrial property that is too close to residential areas will generally have some issues of access and noise to be concerned with.
  2. Property configuration – Look at the property age, layout, and access. The configuration will be of relevance to both buyers and tenants.  Are there some factors of attraction that would pull in the people to inspect?  Technology and communications are important factors in property occupancy today.
  3. Improvements within and around the property – How will a business or tenant use the premises and on that basis how do the services and amenities match their requirements?
  4. Car parking – Most businesses today need convenient and accessible off street parking for both tenants and customers. Deliveries will also have an impacting factor on car parking size and capability.
  5. Customer needs – Many businesses interact with their customers in particular ways. A good example would be via a showroom, and sales or service point within the property.  Building designs need to be considered.
  6. Location of the property to customers and end markets – The property location could be very relevant to certain customer segments, raw materials, and end user markets.
  7. Budget for the purchase or renting of the property – Does the buyer or tenant really understand the facts of costs and rent today?  You will need to explore those facts.
  8. Staffing requirements – Determine just how many staff will work in the property and what the service and amenities will be required. Will staff numbers be changing?
  9. Property zoning – There will be limitations on the property use based on the zone and the associated regulations for the area.
  10. Warehouse space – Size of warehouse will be relevant to the business and operations.  How will they use the warehouse?
  11. Height – How high will the warehouse need to be? Understand the storage and height factors for the business to operate successfully.
  12. Pallet capability – How will the business use their storage area and how high will pallet storage be?
  13. Racking – Where will they want to put their racking? Some racking configurations will need to be investigated further.  There may also be building code compliance issues with the racking.
  14. Clear span – Modern industrial buildings have fewer columns internally and generally are of a clear span construction. On that basis the modern industrial buildings will achieve better rents.
  15. Flooring – How will the tenant or occupant use the floor area, and if they are using pallet lift trucks what are the tolerances on the floor loading? Also check the floor for cracks and levels to ensure that pallet trucks can operate safely.
  16. Roller doors – Determine the sizes of the roller doors at all warehouse access points. They will be relevant to truck delivery and access.  Also understand how trucks can move through and into the property in a convenient and efficient way.  Is there sufficient space within the property for trucks to turn around after loading or unloading?
  17. Hardstand – Will there be any exterior storage space required for the business? That exterior hardstand storage part of the property will be part of the overall leasing equation.  There will be a rental for that space.
  18. Loading facilities – Loading docks and delivery zones could be very important to the industrial business. The hours that the business operates and the layout and capability of the loading facilities will be very important.
  19. Storage internally – Understand how the business will be using internal storage and determine if there are any special regulations that apply to that storage. There may need to be special considerations applying to flammable liquids, gas, and flammable items.
  20. Fire Prevention devices and systems – Some industrial businesses and occupants require specific fire prevention devices as part of occupancy. There will also be code compliance issues and regulations applicable to the property itself.  Ask plenty of questions when it comes to building code compliance and occupancy.
  21. Electrical power capability and supply – There are different power and energy supplies for industrial application. What capability does the property have?  You may need to talk to the local energy suppliers to understand energy capability and costs.
  22. Office space size and fitout – How will they use the office space and how big does it need to be? In any industrial property the office space will be part of the overall business strategy and layout.  The size of an office space will be particular to the tenant or business in occupation.  Use valuable to visit the business in any other location where you can inspect and understand their daily operations from an office layout perspective.
  23. Access to transport, ports, airports, and rail heads – Moving product and goods will be a consideration for most industrial businesses. Determine where the highways and freeways are locally, and how the industrial business will use those transport facilities economically and efficiently.
  24. Rates and taxes – These cost factors are perhaps the largest of the outgoings in any industrial property. It always pays to understand the averages that apply to rates and taxes in any investment property.  Compare the property outgoings for your particular listing with the others in the area.  Make sure that you are working with a property that is realistically costed when it comes to outgoings averages.
  25. Outgoings for the property – The costs to operate the property as an investment are likely to be recoverable in some way or form through the lease documentation. Alternatively, any gross rental will be structured to include the outgoings strategies and costs for the property.  Understand the outgoings that relate to the asset and how they are being paid for by the landlord and or tenant now.

Are you ready to tap into the opportunity of industrial property sales and leasing?  Create your checklist to support your client interaction and professionalism.

You can get more industrial property tips in our eCourse ‘Snapshot’ right here.

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