FAQs

Listed below are details for further understanding different types of industrial real estate facilities and their multiple purposes.

Evidently, industrial properties are a critical component of the real estate industry and they come in many forms. Understanding the different types of industrial real estate facilities and their purpose is essential for making informed decisions about investing in commercial real estate, particularly investing in industrial real estate.

Industrial properties typically refer to stand-alone structures or land used for industrial activities such as manufacturing, warehousing, or distributing goods. These properties come in various sizes, from large industrial parks with multiple buildings to small single-building spaces.

This details below explore the most common types of industrial real estate facilities, their purpose, and features.

Manufacturing Facilities

These are properties that are primarily used for the production of goods through various manufacturing processes. According to NAIOP, these properties have office spaces that take less than 20% and loading docks at least 10 feet.

Large open spaces, high ceilings, and specialized equipment for specific manufacturing processes often characterize manufacturing plants.

The open floor space allows workers to move around easily and efficiently during manufacturing. The high ceilings are designed to accommodate large equipment and to allow for proper ventilation and airflow.

Depending on the type of manufacturing being performed, manufacturing plants may feature specialized equipment such as assembly lines, conveyor belts, robotics, and other machinery designed to streamline the production process.

Manufacturing facilities are designed to produce goods on-site and are outfitted with specialized equipment and machinery for assembly lines or production tasks.

These facilities typically have large open interior spaces that can accommodate heavy machinery and utility services such as power, water, and waste disposal.

In addition to manufacturing facilities, industrial buildings may be used as research and development (R&D) spaces for inventing new products or processes.

Warehousing and Distribution Centers

Warehousing and distribution centers are typically large open-space buildings that use specialized shelving systems to store goods. These operations can range from a single room to an entire building and are designed to store and organize goods for distribution.

Warehousing and distribution centers often have loading docks with access to transportation networks such as railways, highways, waterways, or ports. Many warehouses also use specialized equipment such as conveyor belts, robotic arms, or automated storage systems.

Specialty Industrial Buildings

In addition to warehouses and manufacturing facilities, industrial real estate includes specialty buildings such as cold storage facilities or data centers. Cold storage facilities are designed to store perishable goods at a specific temperature, often using specialized refrigeration or freezing systems.

Data centers house vital computer equipment supporting business operations, government agencies, and other organizations. These properties typically require high-end power, cooling, and security systems.

Flex Buildings / Flex Spaces

Flex buildings are an increasingly popular option for industrial real estate. These facilities offer flexibility and can be used for various purposes, such as light manufacturing, warehousing, office space, or research and development.

Flex buildings usually have small to medium-sized interior spaces that can be customized to meet the needs of businesses. They typically include loading docks, utility services, and other amenities for commercial use.

Flex space properties are usually characterized by their versatility and ability to adapt to different tenant requirements. They are usually built with open floor space and enclosed offices or conference rooms. The industrial space in flex space properties is designed for manufacturing or storage, while the office space is used for administration and management.

Heavy Industrial Buildings

Heavy industrial buildings are large structures designed to produce large-scale goods requiring significant space and robust equipment. These properties may include factories, power plants, or refineries.

Heavy industrial buildings often have specialized features such as high ceilings, reinforced floors, and heavy-duty mechanical systems to accommodate unique processes and machinery.

Heavy industrial buildings may also feature extensive high-capacity HVAC systems, cooling towers, or water treatment systems, depending on the purpose.

Light Manufacturing Buildings

By contrast, light manufacturing buildings are designed to produce smaller-scale goods and typically require less space than heavy industrial facilities. These buildings may be used for fabrication, assembly, or other production tasks that do not require specialized equipment or features.

Light manufacturing buildings often feature general-purpose construction such as standard ceilings and floors, basic mechanical systems, and utility connections.

Data Centers

Data centers also often include high-capacity internet connections and redundant communication networks to ensure businesses can access their data anytime, anywhere.

Generally equipped with an uninterruptible power supply (UPS), backup generators, and other devices, data centers can withstand power outages and other disruptions that could cause damage or downtime.

Data centers also require advanced security systems to protect confidential information from unauthorized access. These properties typically feature robust firewalls, multiple authentication methods, and secure entryways.

Data facilities house large computer servers and other data storage, processing, and communication equipment. They are critical to the operation of many businesses, as they provide the infrastructure necessary for cloud computing, e-commerce, and other online services.

Data centers are typically designed with highly specialized infrastructure to ensure the smooth and secure operation of computer servers and other equipment. This includes backup power supplies such as generators and batteries, advanced cooling and ventilation systems, redundant internet connections, and robust security measures to protect against cyber-attacks and physical intrusions.

Wet Lab Buildings / Research and Development Facilities

Wet lab buildings are designed to accommodate research and development activities that require a controlled environment, such as scientific experiments or medical studies. These facilities typically feature specialized equipment, temperature control, and air filtration systems.

Research and development facilities are designed to accommodate scientific research and experimentation, product development, and testing. Companies in the technology, pharmaceutical, and biotech industries, government agencies, and academic institutions often use these facilities.

Depending on the purpose of the wet lab building, it may also include hazardous materials containment facilities, fume hoods, and other safety measures. The interior and exterior of the building must also meet local and state regulations to ensure safety and compliance.

Storage Buildings

Storage buildings are used to store a variety of items, from office supplies to vehicles. These spaces are typically outfitted with shelving or racks and can be as simple as a single room or as complex as an entire building.

Many storage buildings also feature high-security measures such as alarm systems, video surveillance, and access control systems to protect stored items from theft or vandalism.

These facilities can also be used as workshops with specialized equipment for woodworking, electronics, automotive repairs, or other projects.

Telecom Centers

Telecom centers are a type of industrial building designed to house communication equipment. These properties typically feature redundant power, cooling, and communication systems to ensure an uninterrupted connection for businesses or organizations.

While similar to data centers, telecom centers are built to service a different purpose and may require additional features such as taller ceilings or larger equipment rooms.

These buildings also require advanced security measures such as firewalls, controlled access points, encryption technology, and physical barriers. The highest levels of protection may be needed for telecom centers that house sensitive information.

In addition to these measures, telecom centers may include space for offices and conference rooms. This makes them ideal for businesses in the communications sector, such as cell phone providers or internet service providers.