When owning and operating a business, every decision impacts your bottom line. So, when the time comes to buy or lease warehouse space in Maryland, it makes sense to try and find a property that not only meets your physical needs, but also your financial needs. What business owners want to know is how to find cheap warehouse space – and there are a few ways to go about it.
How to Find Cheap Warehouse Space
“When selecting warehouse space, you have a number of factors to consider,” explains Jonathan Keyser, Business.com. It can be pretty overwhelming. Fortunately, there are a few options to help make your search for the perfect warehouse a bit easier.
Work with a Commercial Real Estate Broker
There are plenty of warehouses on the market throughout Maryland, but which one is right for you? And how do you find it? One of the best ways to find affordable warehouse space is to work with an experienced broker. It’s the broker’s job to show you multiple properties that fit your needs and budget and help you compare them to find the perfect fit. Brokers have access to up-to-date market data, databases, and tools that track industry trends, vacancy rates, and comparable properties. All of this specialized industry knowledge helps ensure you find the right warehouse space at the right price. Your broker will also play a big role when it comes time to negotiate terms, ensuring you receive a market deal.
“In Maryland, landlords will express their rent as an annualized rate and then they put an acronym on the end (NNN, MG, or FS),” explains Charles Peacock, United Development Realty Founder and CEO. “That acronym will tell us whether or not the expenses for operating the building is also included in that rate.”
- With a Full Service Lease (FS), the landlord pays the expenses associated with the property, including property taxes and insurance, repairs and maintenance, and utilities and janitorial services.
- With a Triple Net Lease (NNN), the tenant pays the pro-rata share of property taxes, insurance, and common area maintenance (CAMS).
- With a Modified Gross Lease (MG), the landlord and tenant each pay a share of the expenses. However, the rate is fixed, so there are no hidden expenses.
“It’s not so important how your landlord expresses the rent as it is that you know your all-in number,” explains Peacock. “So, you’re going to want to work with your broker to make sure you understand your total cost on each space you’re looking at. That way you can make an informed decision.”
Purchase Vs. Lease Comparison
Whether you have an established business or you’re just starting out, you have a very important decision to make right off the bat. Are you looking to lease warehouse space, or do you want to purchase the property?
“As with most debates, there are pros and cons for both leasing and buying warehouse property,” says Keyser.
- Leasing warehouse space requires less upfront capital than purchasing a building. It also means you are only locked into the space for as long as your lease – you have the opportunity to grow or downsize when your lease expires.
- Buying warehouse space also has its benefits. For starters, the tax benefits of owning a property can be pretty significant. You will also build equity over the years. However, purchasing a commercial property obviously requires a greater upfront capital, not to mention maintenance and utility costs for the duration you own the building. So, it’s important to analyze your current financial situation.
Coming to the right decision takes time, market research, and business planning (a broker can also help you here). Consider the following questions. Can you clearly predict your long-term space needs? What is the state of the real estate market? Is your industry stable? Can you afford to take the financial risk of purchasing a commercial property right now?
“Once you’ve answered these questions and decided whether to lease or purchase, looking for a new warehouse space remains a daunting task,” says Keyser. “You’ve got a lot of moving pieces to consider when trying to find a location that suits both your current and future requirements.”
Thoroughly Evaluate Every Property
There are several factors to consider when evaluating commercial properties.
- Location, Location, Location – As with any real estate transaction, location should be top of mind. Is the warehouse space in an up-and-coming location? Is the space convenient for your business?
- Condition – How old is the building? Is the warehouse in good condition? What has the property been used for in the past? Does the space require any build out, or is it move-in ready to fit your needs? A thorough inspection of any potential property is a must to uncover hidden issues.
- Zoning – Depending on your intended use, it’s important to ensure the area is zoned for your unique needs.
- Parking – Depending on your intended use, parking might be a factor. Does the space have ample parking?
United Development Realty Knows How to Find Cheap Warehouse Space in Maryland
If you want to find a commercial property that fits both your needs and your budget, you need United Development Realty on your side. We provide commercial real estate brokerage services throughout Maryland. We will help you find, negotiate, and lease or buy the warehouse space that is right for your business. We begin this process by listening to your vision, your objectives, and your goals. Then, once we fully understand your business and its unique needs, we can assist you through a tailored package of services.
|Site Selection||Lease Analysis||Lease Renewals|
|Lease and Purchase Negotiations||Expansions & Relocations||Additional Offices|
|Purchase vs. Lease Comparison||Start-Ups||Timeline Management|
|Negotiation Strategy||And So Much More!|
At United Development Realty, we immerse ourselves in real estate not just because we love it, but because it is good for our clients. Please call our office (locations in Bethesda 240-221-1976 and Fells Point 410-522-1632) to get in touch with an experienced commercial broker today.