The industrial property market is an entry level segment of the industry where most property investors initially focus. The simplicity of the cash flow, tenant selection, and property improvements make it easy for the ‘budding investor’ to understand the opportunities of the future when it comes to any single property, its cash flow and its value.
It should also be said that the industrial property by type is the easiest to understand for any new agent to the industry. It is also relatively simple to promote an industrial property to the local businesses in any town or city. As part of that process it is very wise for any agent or broker to understand the movements and requirements of local businesses and tenants when it comes to the industrial property segment.
- Many properties are located in a precinct or a zone where other businesses are already trading. Some of those locations will be well established and thriving industrial business locations. You need to know why those locations work more effectively than others; the answers are usually centred on zoning, transport, client access, raw materials, and property services.
- Understand the improvements in the property and their relevance to the target market and the asset itself. Are those improvements redundant or in need of an upgrade? If that is the case, the landlord could undertake certain property upgrades prior to any promotional process.
- A typical business or industrial tenant will have unique priorities when it comes to property configuration, hard stand storage, warehouse, office layout, and security, together with access, transport, exposure, customers, and staff. As part of interacting with any prospective property buyer or tenant work through the priorities that they have with those issues.
- When inspecting the property, look for the strengths and weaknesses, and then the impact that they may have with any inspection or marketing process. Many a landlord would prefer not to spend any money when it comes to listing and marketing a property. Unfortunately that choice can then frustrate the enquiry level and the inspection process.
- Review the property totally and effectively. Make the recommendations to the client based on market evidence and the results from other listing activities. Give the client some choices, but make sure they see the best alternatives to take in their circumstances.
It is worth noting that the industrial property segment will usually respond quickly to any upturn or downturn in the business segments and the economy locally. To remove the peaks and troughs from the market segment, and potentially any volatility from your perspective, get to know all local businesses in your property territory. Don’t focus on just one tenant or business type.
Understand what tenants are doing when it comes to leasing, occupation, expansion, and contraction. Connect with them regularly so that they remember you at the right time when it comes to property changeover. A top agent with a comprehensive database of local businesses will always attract more landlords and convert more listings. In the industrial property segment or marketplace that attraction is a very powerful advantage.