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We visited a manufacturer of pre-engineered buildings that was operating in several hundred thousand square feet of former retail stores and warehouses. The space worked well for manufacturing, and it was clear that it would also work well for warehousing.
The original occupant of the space was a discount retailer, and the buildings had been idle for several years. Presumably the space was acquired at costs that are below market, mostly because the location was no longer viable for its original use.
North America is amply supplied with shopping malls. Real estate experts say that we are “over-malled”, particularly following the pandemic that stimulated an enormous growth in e-commerce shopping. Much of this came at the expense of brick and mortar locations. The class A malls are coming back, but class B and C properties are probably doomed.
When you need additional space, consider the possibility that some space in the B and C malls could be converted for warehousing. There are some obvious problems: Loading docks are lacking and the cost of adding them may be significant. Fire protection may be inadequate for high density storage.
In most cases, these problems are correctable, but at what cost? When storage space is scarce, and the cost of constructing new warehouses seems prohibitive, consider the option of using obsolescent retail malls.
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