Q&A: The Expansion of Flex Warehousing Solutions

Co-warehousing and flexible warehousing solutions continue their momentum in the larger industrial sector. Operators and providers of these services and spaces typically aim for clients that have changing needs in terms of scaling, and are looking to avoid the drawbacks of a long lease term. In today’s economic context, co-warehousing can help small businesses not only survive, but also thrive.

Nearly two years after Commercial Property Executive talked with Portal Warehousing CEO Alex Morrison, we checked in again to see how his company and this type of product have evolved.

We’ve seen a rise in popularity among investors for shallow-bay, multi-tenant industrial product in high-population growth, infill markets. In your experience, why is demand for this type of product so high today?

Morrison: From a fundamental real estate perspective, the demand for small-bay multi-tenant industrial is growing while the supply is static or even shrinking in some markets. Small-bay industrial is significantly more expensive to develop than Class-A industrial, meaning new supply does not come online in most markets. Capital markets also favor the long-term credit tenancy that comes with newly built industrial product, which can incentivize developers to even demolish existing small-bay space for new product.

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RSK: ANother interesting concept...flex warehousing for smaller to medium use tenants....grow into your space.