industrial

St. Catharines Industrial Base Lease Rates Surpasses $8 per sq. ft.

If you’re an industrial tenant coming out of a long term lease wanting to know your relocation/expansion options, there is probably a bit of a shock when you check to see what’s out there and the price tag that comes with it. Not only has inventory dried up, but rental rates have risen drastically, by 30-40% in the last few years. What should you be expecting?

St. Catharines still with the highest demand now has industrial inventory leasing at least $8 per sq. ft. for a quality building. Other municipalities in the region have also had significant increases, so it’s not as if you can avoid new market rental rates. Some industrial buildings have achieved $10 per sq. ft. or higher if they are perceived to have premium location and features.

If you’re wondering if there will be an end in sight to these industrial market conditions, we aren’t seeing it at this time. In order for there to be relief in rental rates either something catastrophic needs to happen to the market that causes a lot of businesses to fold, or a significant amount of new inventory needs to be added. While there is turmoil in global markets due to the threat of trade wars we currently aren’t seeing activity that would be alarming to Niagara’s industrial real estate market. As for adding inventory it’s just not happening due to the current cost of construction. As costs for building continue to increase, it makes it more difficult to justify as the return on investment isn’t high enough to support it.

My advice to tenant’s concerned about these market conditions is to start looking at your relocation options early, with a local industrial real estate broker, and be prepared to act quickly.

What type of heating is best for an industrial warehouse?

This blog will focus only on the most popular types of heating in my market and in the golden horseshoe of Southern Ontario, natural gas is often available in most industrial real estate buildings. With that in mind, natural gas is preferred over electric heat sources due to the cost factor. Considering warehouses are large open spaces, what is the ideal way to heat them?

The two primary types of natural gas heating I find in a warehouse are either forced air or radiant tube. Forced air heaters usually hang close to the ceiling and kind of look like a large metal box with vents that blow hot air into a warehouse. Radiant tubes also typically hang close to the ceiling and are in fact long tubes that radiate heat onto the surfaces around it. The primary difference between the two is that one heats the air and the other heats surfaces, so in warehouse setting which is best?

While the answer may ultimately be a matter of preference or a requirement depending the materials a business handles, radiant is often the preferred heat source in a warehouse setting for a couple reasons:

1) If a grade level door or loading dock is opened hot air would escape very quickly, but, considering a radiant heat tube heats surfaces instead of air, people and contents will be more comfortable. This is a common concern for industrial businesses because opening bay doors is a regular occurrence to run the business. Depending on construction materials surfaces often absorb and reflect heat as well, further adding to indoor comfort even when cold air is coming in.

2) For reasons stated above it is often more cost efficient. A forced air heater will run more and struggle to maintain temperature every time a door is opened, and in a warehouse you can imagine the large cubic volume of air that needs to be re-heated as it regularly escapes. Radiant heaters don’t have that struggle.

Ultimately you as a tenant will need to determine the best type of heat for your business, but for those that get frustrated with large bills to heat a warehouse it might be worth considering radiant heat instead if you’re running forced air. It may not be the solution for everyone but it’s definitely worth exploring. If you’re willing to sign a long term lease, some landlords may consider changing the heat type for the right tenant, this could ultimately be negotiated into the lease.

Industrial Space for Lease in St. Catharines - 330 Vansickle Road #2

Industrial Space for Lease in St. Catharines - 330 Vansickle Road #2

Industrial space for lease in St. Catharines - 330 Vansickle Road #2. Unit consists of front showrooms, two washrooms, mezzanine, and warehouse with grade level door access and 18 ft. clear height.

Industrial Building for Lease in Beamsville - 4306 Bartlett Road

Welcome to building B at 4306 Bartlett Road in Beamsville, Ontario. The location is minutes from nearby highway access at QEW and Ontario Street, and, Beamsville is a great in between market for industrial or warehouse tenant’s that cater to both Niagara as well as Hamilton and GTA markets due to it’s proximity to both.

The building itself features a very wide grade level door, a common loading dock, and approximately 16 ft. clear height. The building is expected to be available for occupancy around October 1, 2019 after the current tenant vacates and the landlord can complete some work on the building.

Prior to occupancy the landlord plans to insulate the building, bring in a bathroom, and equip it with a 3 phase power supply. For tenant’s that don’t require some of those features or are willing to use common washrooms instead we can discuss some flexibility in the rental rate.

Industrial buildings for rent in Niagara this size with a loading dock really don’t last long on the open market, especially at these rental rates. It would be ideal to act quickly before someone else takes, space like this is in high demand. Contact me if you have questions or interest.

Why are Commercial, Industrial, and Office real estate leases so long?

“Why is this lease so long?”, “Is all of this wording really necessary?”

I get questions like this from either new businesses, or businesses that have come from a building that simply had a very relaxed leasing policy. More often than not, a relaxed leasing policy and short lease documents that lack detail cause problems.

A commercial real estate lease should be very detailed about the relationship between landlord and tenant. Not only should it contain important details about the deal such as lease term, start date, rental rates, size of premises, use, etc, but it also needs to have details about rules on the property, insurance requirements, types of action that can be taken in the event of a default, environmental responsibilities, and so on. The list is actually quite extensive for what can be contained in a commercial real estate lease which is why most documents are dozens of pages in length. My document often ends up between 30-35 pages depending on the tenant, building, landlord, type of lease, zoning, etc. While many tenant’s may think that’s a long document, I feel each point is necessary and would have difficulty shortening it. I would actually have an easier time finding content to add than take away.

Back to the questions, why are leases so long and is it necessary? If a tenant asks that question and I look at the building they’re in, I likely see issues such as poor maintenance, poor parking arrangements, structural issues, driveway pothole and access issues, and tenant conflicts. A properly written lease document that can address those issues and is enforced by the landlord and tenant ensures fewer issues for both parties. A lengthy lease should be considered as necessary by both parties because leases should be designed to protect the interests of both landlord and tenant. Yes, leases by default are naturally pro-landlord, but that’s because it’s their property. That doesn’t mean there isn’t or shouldn’t be protection for tenant’s so that is something you need to look for and ensure is in your lease. The landlord’s I represent take good care of their buildings because the lease requires them to. This allows the tenant’s to use the property as efficiently as possible to run their businesses, as long as they follow the rules with the other tenant’s. This is the ideal situation for everyone.

Every clause in my lease has a reason and my document is updated when new industry trends occur or new issues are discovered in the marketplace. Each clause has a purpose because at one point it was created to correct a problem or properly define something.

So is all that wording necessary? Absolutely. As long as it reflects the needs of your business and protects the interests of both parties, every clause should be seen as necessary and relevant. Make sure you are represented by a knowledgeable commercial real estate broker to ensure you get what you need from your lease.

Industrial Building for Lease in St. Catharines - 101 Hannover Drive

Another rare listing of industrial space under 10,000 sq. ft. is officially on the market and available next month. 101 Hannover has 5600 sq. ft. of warehouse space coming available which can be combined with the office unit at the front of the building.

The building is located on Hannover Drive, just off of Martindale Road and QEW highway interchange for close highway access. The location is arguably the nicest business park in the city, offering convenience for many amenities an industrial tenant or its employees may need. The building is well constructed with brick and concrete block construction. Though the parking lot is currently adequate the landlord is prepared to expand it for uses that require additional parking spaces.

Inside the space is open concept with only one column approximately in the middle of the unit. Interior features consist of 18 ft. clear height, radiant heat, a grade level door, two washrooms, and an entrance area with window display.

This unit will not last long on the open market due to the demand for space this size. It would be wise to act quickly if you think this building can meet your criteria.

What is a rent free period in a commercial or industrial real estate lease and how do you achieve one?

A commonly requested or negotiated item in commercial real estate leases is a rent free period. Depending on market conditions for the type of space or building you’re looking to lease you may be able to achieve one.

A rent free period is a defined period where the tenant does not pay rent either prior to their lease term or at the start of their lease term. How much rent free to ask for is usually dependent on market conditions and the reasons for needing a rent free period. For Example, an office or industrial tenant looking to build out a new floor plan of offices might need 2 months to complete the work at their cost, and in turn would ask if they could achieve two months rent free to make the transition smoother. A landlord might see this as a reasonable request dependent on market conditions and the length of the lease term.

Speaking of the lease term, a rent free period is usually not considered unless you are signing a longer term lease, which in current market conditions is usually around 5 years depending on the landlord, property, and the reasoning. If you are not prepared to offer a lengthy commitment, it would be wise to not request a rent free period as you would be seen as unrealistic. It would also be wise to not request too much rent free period for the same reason unless it’s a very unique deal that warrants it.

There are also different options for a rent free period. In the situation of a triple net lease for example, some landlord’s may only agree to giving base rent free, meaning the tenant would still pay their proportionate share of property expenses through TMI, CAM, or additional rent depending how the lease is worded (this is common practice and considered a reasonable request).

There is also the option of having a rent free early occupancy period or a rent free period at the beginning of the lease term. If your lease starts February 1, 2019 and you have one month rent free early occupancy, your rent free period would be for the month of January before your lease starts. If it is rent free within the lease, it would likely make February the month you have free. What is agreed is usually a matter of preference between landlord and tenant. For landlord’s, it’s usually more of an advantage to have rent free early occupancy because if you have a 5 year lease, you still get the full 5 year term whereas with rent free within lease, the beginning of the term is eaten up with the free period.

A rent free period is a common negotiating tool for commercial, industrial, and office building leases, but it has its limitations in many markets and not all landlord’s consider it. Because it’s an incentive there may also be a claw back clause in the lease for that incentive in the event the tenant defaults. If the landlord agrees to a rent free period it’s because they feel there is a legitimate reason for the timing of the request and that it benefits their long term big picture of their investment property.

In the current Niagara industrial market, in particular St. Catharines, space is tight so rent free incentives usually aren’t very long if considered. Rent free on a commercial retail space is dependent on building and scenario and office buildings usually have consideration for it if the tenant intends to do their own improvements and alterations to the space.

To make sure you’re getting the best advice on rent free incentives, make sure you’re speaking with a knowledgable commercial real estate broker for the market that you are in.

Are you an industrial tenant that can't find a building in Niagara?

If you’re an industrial tenant in St. Catharines or Niagara looking on commercial listing websites and noticing nothing with your criteria is coming up or if you’re calling real estate offices with similar results, that’s likely because there aren’t any… at the moment.

The best thing you can do is speak with a reputable commercial real estate broker and let them know what you are looking for and how long you can wait for it. I have conversations daily with tenant’s expressing this frustration, but, sometimes there is a solution if you talk to the right people. I have a database of properties that have leases coming due on the regular. Sometimes I have a creative solution. A conversation with the right commercial real estate broker can make a difference.

I had a conversation with an industrial tenant the other day discussing their timing and expansion options. I happened to make them aware of a building we can pursue in a few months with expansion options a year from now, an option he wouldn’t know about unless that conversation happened.

Right now I’m keeping tabs on the tenant’s looking and when availabilities come up I like to make them aware of it. If you want to be one of the tenant’s that benefits from opportunities that can be created by a commercial broker, please contact me. Don’t expect residential Realtor’s to be of the same level of assistance, their knowledge is usually limited to what is available right now, which isn’t much.

The difference between loading docks and grade level doors in industrial real estate.

I've heard tenant's and landlord's use grade level door and loading dock interchangeably as if they are the same thing. They are not.

Most industrial buildings, units, or space for lease contains a grade level door. It would be rare if a building wasn't equipped with one as they are a standard useful feature. A grade level door opens and closes down to the grade and if that sounds confusing just replace the word grade with ground. The door is level with both inside and outside ground so as you can easily move objects through in and out. Most times these doors are large enough for vehicles to drive through which is an important feature for many tenant's.

The loading dock is different in that the door is truck level and acts as a dock to safely move between building and truck trailer. A transport truck can back its trailer into a loading dock and when parked, it should be possible to enter the truck through the warehouse by flat surface. This makes it possible to load and unload goods quickly, especially with the use of a tow motor or fork lift. Unfortunately loading docks are in demand but have low supply, especially for industrial units under 10,000 sq ft. Compared to grade level doors a loading dock is not cheap or easy to install which is why they are more rare. A property needs to be able to handle truck access to back into a dock as well.

In St. Catharines and the Niagara region it is unfortunately difficult to find loading docks in our current supply of industrial buildings. While there are currently and abundance of grade level doors, it would be good if developers and building owners started recognizing the shortage of loading docks to ensure they are a more common feature for warehouse and distribution tenants needing to rent warehouse space with that feature.

10 things to consider if you're a tenant wanting to buy a commercial or industrial building

I work with a lot of tenant’s and something I commonly hear from them is that their goal is to buy a building. Owning commercial or industrial real estate can be an excellent investment and a worthwhile pursuit, however, I have discovered that most tenant’s with this goal aren’t aware of what is required to buy a building when they make this statement. Not only do I do commercial and industrial leasing, I also do sales, and I want tenant’s to know what the process is like not because I want to discourage them, but because it’s a process that is approached best with eyes open and expectations realistic. I would say most tenant’s abandon this pursuit after learning about the requirements and the process.

To start, the biggest thing you need to know is that getting a commercial real estate mortgage is way different than getting a mortgage for your home for many reasons. It’s common to encounter large downpayment requirements, fees, appraisals, an environmental site assessment etc. which adds time to the approval process. Many residential mortgages achieve approval within a couple weeks, but on the commercial side it could take months. Below is a list of things to consider before you even start looking at properties for sale.

1) High Downpayment Requirements - Probably the most notable obstacle for buying any real estate is ensuring you have enough for a downpayment. In comparison to residential mortgages that can offer a great deal of flexibility on the down payment requirements, it’s common to see a demand of 25% - 40% downpayment. I’ve met many business owners that have assumed this requirement can be much lower and have come to realize they just don’t have the ability to put together that much cash. There may be some flexible exceptions out there through private lending options or through the BDC that can present better options for buyer/users but this is dependent on the business.

2) Bigger Deposits - With bigger downpayment requirements comes the need for bigger deposits (and for other reasons). It’s common for knowledgeable commercial real estate brokers to try and achieve a deposit around 10%. Why? Commercial sales can take a long time to come together and if you’re expecting to tie up someones property with lengthy conditions you need to prove that you’re worth the wait, and, show that you obviously have a good chunk of cash ready for a downpayment. If you’re expecting to tie up a property with a few grand, you may be perceived as unrealistic.

3) Longer Closings - In comparison to home sales which can go firm within a couple weeks, it’s common for commercial sales to take a couple months, sometimes even longer depending on the structure of the deal. The main culprit for longer deals is usually the financing where lenders request environmental site assessments that can take anywhere from weeks to months to complete. It would be wise to expect occupancy of the building to be months into the future, don’t expect to be moving your business in within the span of a month. It’s not impossible, just very unlikely.

4) Different Mortgage Requirements - In addition to high down payment requirements, commercial mortgages are typically structured differently. The interest rates are different from residential and it’s not common to get an amortization period as long as you could achieve in a residential mortgage. Not only are the down payments higher, your mortgage payments will be higher with having to pay the building off sooner. It’s also common to come across fees in the process of commercial lending which is not something you typically encounter when buying a house.

5) Environmental Site Assessments - In Canada (and probably most of the United States) it is standard for commercial mortgage lenders to request an ESA for commercial and industrial properties to prove it is within ministry of environment standards. Most times it is standard for the seller to prove the property is within MOE standards so the cost of the report usually falls on them, but, this condition can take anywhere from weeks to months to complete which can create a lengthy conditional period and a potentially drawn out closing. Things usually get drawn out and costly if contamination is discovered.

6) Lender Selection - You would think that most of Canada’s big banks are a great source for a commercial mortgage but few actually specialize or excel in offering this service. If you’re not exactly happy with your preferred bank for commercial mortgages you may want to explore lenders that specifically market themselves for that service.

7) Borrowing Potential - If you think that owning a building might be the best thing for your business, it actually may not be for everyone. Each business only has the potential to borrow so much money and if it’s perceived that most or all of your borrowing potential is tied up in bricks and mortar, it may be difficult or impossible to borrow money for other business purposes, like if you wanted to borrow to upgrade some expensive equipment or make alterations to the property. Unfortunately I have met some tenant’s who have felt that buying a building paralyzed their business growth and regretted their decision. The positive idea of building ownership can make you blind to this potentiality.

8) Lease Payments are Tax Deductible - Mortgage payments… not as much.

9) Cost of Alterations - Unless you’re building new to spec, you will likely find it impossible to find a building that is perfect for your business needs in its current state. Alterations to make sure the building is a good fit for your business are almost always necessary because the previous business was different and had different layout needs than your business. The cost may not necessarily be high in some situations but you will want to make sure you have a proper budget allocated for this after closing.

10) Maintenance and Repairs - As a tenant the building is likely repaired and maintained by arrangements through the landlord or a property management. This is handy because it allows tenant’s to focus on their business and not maintaining a property. Once you buy a building you become the landlord and are now responsible for arranging repairs and maintenance, just something to keep in mind.

If after reading this you feel that buying a building is the right thing for your business then please reach out and lets see if there are some options available for you in the Niagara Market. It would be wise to ensure the agent you’re working with has experience with commercial or industrial real estate sales.

2019 Industrial Lease Rates for St. Catharines

In the last year industrial lease rates have once again soared past expectations. This is what happens when business is good and there aren’t enough buildings to house everyone.

For those curious, this is a very general approach to industrial building lease rates in St. Catharines. In the East end of the city, quality B class buildings will start around $6.50 per sq. ft. for base rent, $7+ per sq. ft. or higher can be justified for A class. For the West end of the city B class would start around $7 base rent and A class industrial buildings are now achieving over $8 per sq. ft. and might creep closer towards $10 if things continue at the rate they do.

To ensure that you are paying market rental rates it would be wise to enlist the services of a commercial real estate broker that not only possesses that knowledge, but also knows when and where to find the building or space you need for your business.

Niagara Spring 2019 Industrial Market Update - There is no small space

Industrial Warehouse

Industrial Warehouse

As vacancy shrinks and rental rates rise in this crazy industrial market, it’s important to keep these conditions in mind as you search for industrial buildings or space for lease for your business. This blog applies to all of Niagara, especially St. Catharines.

If you’re looking for something under 10,000 sq. ft. start looking very early and be patient. Speak with knowledgable industrial brokers with their ear to the ground and may be able to make you aware of a coming vacancy months in advance.

If you’re looking for a space under 5000 sq. ft… good luck. At the moment there is either none or very few viable options available. You will need to be patient, and, if a vacancy comes on the market be sure to jump on it as soon as possible assuming you will have competition. Don’t assume there’s desperation from the landlord, there isn’t. It’s a landlord’s market so be sure to approach the situation in that way.

For tenant’s looking to get on a wait list for listings as they come available, please contact me to see what your options are.

What expenses can be used in TMI, CAM, or Additional Rent in a commercial real estate lease?

What should be used as a TMI expense is dependent upon how the lease is written, but, the vast majority of the time I write triple net leases and I know most commercial and industrial landlords and practitioners prefer triple net leases where they can be applied, The list below is based on a triple net scenario and isn’t limited to what is listed:

1) Landscaping - The property needs to look well maintained to make a good first impression in a business situation. Lawn cutting, gardening, weeding, tree and bush trimming, litter pick up, and so on can be a landscaping expense.

2) Snow Removal - If you live in a province or state that gets snow, snow removal contracts are a necessity for commercial and industrial properties to ensure businesses and customers have a place to park. Salting and Sanding also falls into this category.

3) Parking Lot Repairs - Parking lots function and look best when the pavement is smooth and free of potholes.

4) Roof Repairs and Maintenance - There are various things that can cause a leak in the roof but leaks tend to occur most towards the end of the roof life. Fortunately repairs can be made and the roof can often be functional for years longer with proper maintenance. There will reach a point where repairs won’t work and a full replacement will be necessary.

5) HVAC Maintenance and Repairs - To ensure the longest life and most efficiency of your HVAC units you should have a regular maintenance contract. A few visits a year from an HVAC technician to keep the unit clean and running smoothly is a wise idea.

6) Outdoor and Common Area Lighting Costs - Tenant’s and Customers definitely appreciate it when coming and going during darker hours of the day, and, having a lit building is a bonus security feature.

7) Property Management and Administration Costs - Property management takes time and money. It would be rare to see management fees higher than 15% of the property expenses but this depends on the landlord and management company.

8) Elevator Maintenance - Elevators require monthly maintenance contracts to remain operation.

9) Waste Removal - If you have common waste, recycling, or compost bins for tenant use.

10) Outdoor/Common Walkways, Ramps, or Stairs - Need to be maintained to code for safety.

11) Fire Prevention - For buildings with sprinkler systems, common area alarms/detectors, these are items that have maintenance costs. Depending on the situation, most times tenant’s would have alarms/detectors in their own units at their own expense.

12) Security Systems - For common areas only. Tenant’s should do their own monitoring for their own unit.

13) Electrical - Maintenance of the electrical room or main transformer.

14) Water - Most units of commercial and industrial buildings don’t have a separate water meter. Water costs should be added to the TMI in this situation, except if there is evidently a tenant that uses more than the others, a fair approach to billing should be made.

15 Insurance - For building and land. Tenant’s should be providing their own content and liability insurance as per the lease.

16) Property Taxes - The largest and most obvious expense.

This list can and will be more extensive in the future, but for now this is a good base guide.

Depending on the wording of your lease you may be able to amortize capital improvements over a longer term. The default wording of my lease allows for roof, HVAC, and parking lot replacement costs to amortized over 10 years but this isn’t used in all documents.

If you’re a client of mine that needs some assistance with best TMI practices I have no problem offering that help. Make sure you work with a Realtor that knows all of the expenses that need to be accounted for.

How to Calculate TMI ,CAM, or Additional Rent on Commercial and Industrial Buildings

This blog is targeting commercial and industrial buildings that have little or no common area. Most commercial retail plazas and most industrial buildings will fall into this category. Office buildings, or buildings with an abundance of common area would usually take a different approach which I plan to cover in another blog. If you’re new to this TMI, CAM (common area maintenance), and additional rent are industry phrases to represent the expenses for the property, and whatever phrase is used is usually a matter of preference but TMI is most common.

T.M.I. stands for taxes, maintenance, and insurance so the first place to start is adding together your property taxes, all of your maintenance and repair costs on the property, and your insurance costs for the most recent year. That makes up your combined annual total of property expenses. You simply need to divide that total by the total number of square feet that make up the building. You then have your per. sq. ft. rate for TMI.

A simplified formula: (Property Taxes + Maintenance + Insurance) ÷ total square feet = per sq. ft. TMI rate

If you’re looking for information on what TMI is (also known as CAM or Additional Rent), you may want to visit my other blog post with that explanation here https://www.stevendavidson.ca/blog/2018/8/13/what-is-tmi-cam-and-additional-rent-in-commercial-real-estate-leasing

For information on how often your TMI should be calculated I have a post about that here: https://www.stevendavidson.ca/blog/2019/2/12/how-often-is-tmi-cam-or-additional-rent-updated-in-a-commercial-real-estate-lease

If you were looking for information on how to calculate month rent instead of TMI I have information on how to do that here: https://www.stevendavidson.ca/blog/2019/2/22/how-to-calculate-monthly-rent-for-commercial-real-estate-lease-listings

The industrial Real Estate Business Parks in Fort Erie

Fort Erie is in the bottom right corner of the Niagara Region and last stop in Canada before the USA by the Peace Bridge border crossing. This border crossing gives Fort Erie unique opportunities for industrial businesses regularly importing or exporting from the United States.

Businesses that are keen on having close proximity to the border take note; there is an industrial park Located just off of the Gilmore Road exit of the QEW highway. That’s less than 10 minutes from the United States (granted you have a quick and smooth border crossing). The industrial park is visible from the highway. Most buildings are located on Pettit Road, just off of Gilmore Road.

For industrial businesses looking for buildings with a convenient border crossing, you will want to check out Fort Erie. Lease rates in this area can also be a little lower when compared to larger municipalities in Niagara, such as St. Catharines, Niagara on the Lake, and Niagara Falls.

12 important things to consider when you search for industrial real estate for lease

Industrial Warehouse

Industrial Warehouse

Searching for the ideal industrial building for your business goes beyond finding something that is the ideal size and budget. There are a number of features to consider in your search for industrial space for lease to ensure your term in the building is a comfortable one. Below are important criteria to keep and mind and consider in your search for industrial property, none of these are in any particular order.

1) Clear Height - Having a space that is an adequate size in footprint is useless if it doesn’t have an adequate clear height to rack your inventory high enough that you won’t run out of space. Generally speaking, if you’re a warehouse and distribution tenant, having more height allows you to rack higher and save on the number of square feet you occupy. Higher clear height often creates an opportunity to use your space more efficiently by racking up rather than expanding outward.

2) Power Supply - If you manufacture or use a lot of computers and equipment to run your operation you will want to ensure the space you are planning to lease has an adequate power supply. If your business has a requirement for 3 phase power you will want to make sure the unit is equipped with it.

3) Loading Docks - Another popular feature among warehouse and distribution tenant’s is loading docks. Loading docks are truck trailer height and allow for easy movement of inventory on and off of trucks. Unfortunately not all industrial buildings in Niagara have loading docks, in fact we likely have a shortage in comparison to other areas of the province and country. It can take a bit longer to source a building with loading docks, especially if you’re looking for something under 10,000 sq. ft. in St. Catharines or the Niagara Region. If you’re looking to relocate soon and loading docks are a priority, you may want to start your search earlier just in case.

4) Grade Level Doors - Unlike loading docks, grade level doors open at ground level, not truck trailer level. These doors are more common than loading docks and most industrial buildings have them. These doors are used by most industrial businesses however shipping and receiving inventory through them isn’t nearly as easy as using a loading dock. It’s important to make note of the sizes of grade level doors if you have larger items coming and going.

5) Location - Most industrial operations ship and receive goods by transport trucks so a location with close proximity to the highway is usually preferred. Ensuring the location is easy to get to for trucks is important. If you have a lot of employees you may want to locate somewhere with access to public transit. Some operations may prefer to have a rail spur or access to a waterway for shipping. Some industrial businesses are noisy or produce a strong odour which would be a good reason to locate somewhere a little isolated away from housing and other businesses. These are items to consider based on the demands of your business and a good industrial agent can help you find what’s best.

6) Truck Access - Further to the point above you need to ensure the property itself can allow for the proper flow of trucks to ensure shipments and deliveries come and go as you expect them to. There are some poorly designed properties that make it very difficult for trucks to come and go as they should and those properties should be avoided.

7) Type of Heating - The two most common forms of heating in industrial buildings is either forced air gas or radiant tube. Usually it’s a matter of preference but there are some businesses that can’t work with one or the other for various reasons. In terms of efficiency, in a warehouse setting many operations tend to have a preference for radiant heat as it heats the surfaces and not the air, that way when someone opens a grade level door you don’t lose all your heat.

8) Parking - If you have a lot of employees and a good portion of them own vehicles, you need to ensure the building you have selected has enough parking capacity, otherwise you can run into an issue.

9) Office Space - Most industrial businesses have some requirement for office but not all. For those that do, the space space is rarely more than 10-20% of the total size of the unit. You won’t find exactly what you’re looking for so it’s best to keep the big picture in mind and ensure the industrial/warehouse portion of the space meets your needs more than the office. The office is an after thought that can be modified if necessary.

10) Column Spacing - Depending on your equipment, the flow of your manufacturing, the type of racking you have etc., you may need to keep the distance between columns in mind. For example, if you need to fit a 25 foot machine in between columns that are only 20 feet apart, you have a problem. It’s important to share minimum column spacing requirements with you Realtor to keep note of in the hunt for space.

11) Plumbing and Drainage - Aside from needing a washroom and a kitchen, some industrial operations require additional plumbing and drains throughout their unit. Make sure the buildings you have focused on can have plumbing and drains where needed for your business to function as it should.

12) Work with a Commercial Real Estate Agent - I’ve complained about this in other blogs and I can’t state it enough, now is not the time to hire the agent that sold your house. If you expect knowledge and competence when making a major commitment to a long term lease, you want to ensure your requirements are fulfilled and you want your interests protected. The best way to do this is to hire a commercial real estate agent who has the knowledge, skills, and experience in industrial real estate leasing to help you pull that off. Using an agent that sells houses and doesn’t possess those qualities can create a lot of headaches and unwanted problems during the process and well after the move.

If you want to know more about finding the ideal industrial building please don’t hesitate to reach out and ask questions.

The Industrial Real Estate Business Parks of Niagara Falls

While it may be known for its tourism, Niagara Falls is the second largest city in the Niagara Region and has a healthy amount of industry in their commercial real estate sector. An attractive feature about being in Niagara Falls is that it has its own border crossing at the Rainbow bridge, convenient for businesses that export to the United States. While Niagara Falls may have industrial properties throughout various areas of the city I’ll make mention of the commonly known ones below.

On the West side of the QEW highway and filling out to Montrose Road is a strip that runs through most of the city which is made up of mostly industrial properties, some with highway visibility. Conveniently located with easy access to the highway, this business park is great for truck access.

In the South East end of the city there is another major industrial park off Stanley Avenue which spans closer to the highway and Dorchester Road. While it may be more tucked away than the industrial park on Montrose, this location of the city is still accessible for trucks but a bit removed from the highway so lease rates may be a bit more competitive in comparison.

Like Niagara on the Lake, Niagara Falls is also close by alternative market to St. Catharines for industrial operations, depending on your needs. To ensure you’re getting the best opportunity for industrial leasing in Niagara Falls, be sure to work with an agent that has extensive knowledge and experience in industrial real estate for the area.

The Industrial Real Estate Business Parks of Niagara on the Lake

Niagara on the Lake (NOTL) may be known for it’s wineries and boutique tourist retail, but it’s also home to some of Niagara’s nicest industrial parks.

Located just over Home bridge to cross the canal from East St. Catharines industrial business park, you gradually enter into the NOTL’s industrial business park via York Road. The business park spans to Queenston Road, Airport Road, and Townline Road. This industrial park is conveniently located along the highway at the QEW / Glendale Avenue interchange for easy and quick truck access. Most of the industrial buildings in this area appear newer than most of the industrial buildings in the Niagara Region and are usually constructed to demand a more prestigious/stylish presence than typical industrial architecture. The municipality of Niagara on the Lake enforces strict standards for aesthetic appeal of their buildings, industrial buildings are no exception here. One notable disadvantage to this location is that it lacks some commercial amenities that might be appreciated such as banks and a nearby grocery store, but, it is possible to find a place to eat and you are close to amenities in East St. Catharines. Base rents in this industrial park usually start around $7 per sq. ft.

A second smaller industrial park can be found in Virgil on Henegan Road and Walker Road. With similar aesthetic standards the buildings in this park also look good but this location is a bit removed from the highway and often caters to businesses with a more local focus.

If you’re an industrial business interested in the pro’s and con’s of leasing industrial space in Niagara on the Lake, don’t hesitate to reach out to discover available opportunities.

The Industrial Real Estate Business Parks of Beamsville

If you’re an industrial business that gets a lot of business from Niagara and Hamilton, you may want to consider Beamsville as a good location due to its unique proximity to both central Niagara and Hamilton business communities. Being just down the QEW highway from both St. Catharines and Hamilton, Beamsville’s industrial park is conveniently located right by the highway for easy and quick truck access into their business park.

The industrial business park of Beamsville is bordered by the QEW highway with South Service Road to the North, Ontario Street to the West which is the QEW interchange to access the park, Bartlett Road to the East, and Union Road to the South with Christie Drive in the middle. There are other spots of industrial facilities here and there throughout the municipality, but the bulk concentration is in or near this neighbourhood. As for leasing or buying industrial buildings in this neighbourhood the lease rates and sale prices are often reasonable in comparison to the larger municipalities nearby, but like other municipalities, opportunities and vacancies are rare in our current market.

Aside from being conveniently located between two large regions in Southern Ontario I would say Beamsville did some good planning for its industrial sector by conveniently locating this business park right next to an easily accessible highway interchange. Not only is there easy highway access but there are just enough commercial amenities within a few blocks for food, banking, groceries, etc. to service employees and other functions of the business.

If you’re looking to discuss leasing, buying, or selling industrial real estate in Beamsville, be sure to connect with an agent who knows its industrial market well.

The Industrial Business Parks of St. Catharines

Searching for industrial buildings for lease or sale in Niagara won’t provide you with many options in our current market, especially if you are looking in St. Catharines. It’s a market where you will need to act quick if you do happen to find industrial space for lease, but where should you focus your efforts in searching?

St. Catharines has five main industrial parks to look into, each with its own advantages. I separate each with the labels of the East End, West End, Port Weller, Hiscott, and Secord/Nihan. There are some pockets of industrial buildings that can be found throughout the city, however, the majority of industrial buildings and businesses can be found in these areas.

Arguably the largest industrial park in St. Catharines is the East End which is bordered by the canal to the East, Welland Avenue to the North, The service roads (Dieppe and Dunkirk) to the South, and it sort of sprawls West past Bunting along the highway and service roads and even a little past the other side of the highway on Welland Ave and and Berryman. The closest highway access point for this industrial business park is Niagara Street at QEW. The types of businesses in this area are a diverse mix and the street often has a reputation for catering to specific industries. Take Bunting Road for example, you will find a lot of showroom uses often catering to the home/building improvements, home and building decor, and furniture. The service roads, and Welland Avenue will offer some service based industries as well as warehouse, distribution, and manufacturing. Cushman Road and Seapark Drive attracts mostly warehouse and distribution with some heavier manufacturing uses mixed in. There seems to be quite a few cabinet makers in the area along with some automotive uses if the building allows for it. The advantage locating an industrial business in this area is that the rent is usually reasonable, and with being the largest industrial park there are often other businesses in close proximity you can create a working relationship with.

Depending on the type of business you operate, the West End industrial parks of St. Catharines have been growing rapidly and may be the most sought after location for cleaner industrial uses. This area is comprised of Vansickle Road to the West, Louth to the East, St. Paul West to the South, and Benfield to the North… and even though it’s a few minutes up Martindale, I classify the business park on Hannover Drive to be part of the West End industrial park because the types of buildings and businesses they attract are quite similar. As far as industrial real estate rents go, the West End tends to have the highest in the city, and because most of the buildings are newer and offer some different zoning options, the additional rents are often higher due to higher property tax. The advantage comes to those who want a building and location with a more prestigious look which mostly caters to the showroom, service, and distribution based businesses. While you can certainly find manufacturing in this area you definitely won’t notice dirty operations. The West End industrial business park of St. Catharines enjoys highway access from QEW at Martindale Road as well as Highway 406 at Fourth Ave.

Port Weller, in my opinion, is an unusual location for an industrial park. Back in the day some businesses may have set up shop here due to proximity to the canal and lake access, but it has grown and expanded beyond that. The area is setup with Lakeshore Road to the South, the canal to the West, Read Road to the East, Northrup to the North, and Keefer Road running down the middle. The advantage to being in this industrial park is that it usually has the lowest rents and sale prices in the city, but that comes at a cost. For an industrial park, Port Weller can be a bit isolating for multiple reasons, mostly to do with location. Industrial businesses tend to enjoy close highway access but in this park, it can often take 10 minutes or longer to get and from the highway, or much longer if the bridge is up. The other location disadvantage is that this area is on the other side of the canal from the rest of the city so in terms of access and amenities most things are on the other side of the canal bridge which goes up and down for ships most of the year. Not only is this area a considerable distance from the highway, employees and deliveries can be frequently delayed by the canal bridge. Speaking of employees they will need to have a car to reach this area of the city because the bus service ends on the other side of the canal. Businesses that are attracted to Port Weller due to the cost difference should definitely keep the location disadvantages in mind before committing your business to being there long term.

I consider both Hiscott and Secord/Nihan industrial parts to be small but centrally located with very quick highway access through QEW at Ontario Street or Lake Street interchanges. The buildings in these neighbourhoods often cater to smaller uses that are service, showroom, or distribution based. Rents in this area are fairly average but can easily be as high as the West End depending on the quality of building and location and vacancies are usually rare.

So there you have it, a simplified breakdown of the industrial neighbourhoods of St. Catharines. If you are having difficulty determining where is right for your business, don’t hesitate to contact me for more detailed insight.