Industrial warehouses are getting higher

Unlocking vertical potential in the competitive world of supply chain. Insights from our partners at JLL.

Why are warehouses getting higher?

Higher-height warehouses give tenants more space that allows them greater cubic capacity. That greater capacity translates into more pallets and more stock in a location of equal footprint, and that often means much improved service levels to the tenants and customers. In a very competitive world that is important.

Building heights have steadily increased over the decades to allow an increase in storage capacity.

In recent years, this need for increase in height has often been driven by the increased cost of property, smarter automation and storage systems, and the evolution of materials handling equipment to service pick and pack requirements in high warehouses. Higher warehouses are more expensive to build due to the requirement of floors to be reinforced to take heavier loads and be more even compared to lower height buildings. But even though the increased cost can translate to higher rents, a tenant’s ‘Cost per Pallet’ can be lower than a more traditional warehouse height building. This makes higher-height buildings very competitive for the right tenant.

Warehouse clearance height

Moving to higher clearance warehouses is not for everyone.

Companies may look to higher-height warehouses when:

• Sales growth is strong or a merger is on the cards.
  • More cost effective utilisation
  • Improvements in packaging enabling more efficient storage
  • Improvements in MHE abilities

• Consolidating numerous facilities into a single facility.

Published: 25 September 2024.

Originally published by JLL Australia on 10 September, 2024.

About the uTenant x JLL partnership

By collaborating with Jones Lang Lasalle (JLL), uTenant are able to make industrial property matching readily available to tenants and landlords. We ensure our clients receive maximum visibility, leading market insights, and the best possible opportunities for all industrial property requirements.

The uTenant and JLL partnership is the best of two worlds. Our combined teams of passionate people work closely and go above and beyond for our valued clients. The real estate market knowledge, connections, and global resources of JLL, together with uTenant’s innovative, creative, and effective warehouse sourcing business model, is what makes our Property Matching platform so unique.