Industrial Real Estate Defined

Industrial real estate is often visualized as a towering building or set of buildings emitting plumes of grey smoke or an enormous windowless, fortified structure, home to endless vehicle assembly lines. While there is a bit of truth to these building types, industrial real estate can be much more varied.

A general description of industrial real estate can be stated as consisting of constructions and structures (e.g., buildings) and land used for temperature-controlled storage (e.g., cold)/warehousing, distribution, production/manufacturing/assembly (heavy and light), research (dry and wet lab), data centers, and even showrooms and sound stages.  Some industrial real estate is mixed-use, and more commonly termed “flex space” because there is office space within the warehouse.  For example, a distribution center, manufacturing warehouse and data center can have business associated professional office space within the structure.

Showrooms, another industrial asset category, are most often located in a commercial retail corridor. Showroom-style industrial would-be car dealerships; which frequently cluster in a highly trafficked retail corridor, or an appliance showroom. Most of the industrial real estate however is located away from urban centers traditionally designated for business, retail and residential. Industrial real estate locations will be explored later in the course.