The rise of e-commerce has shifted the dynamics of consumer demand and the chain of supply to meet that demand, perhaps more than any other force in the last century. Suppliers now need to meet the challenge of distributing product efficiently to consumers, rather than distributing bulk products to retailers. This has had a tremendous effect on industrial real estate and created a growing need for industrial and warehouse financing.
There are so many possible uses for industrial properties it is hard to generalize about industrial-property loans. Industrial properties can house a range of business operations from manufacturing plants to research and development, storage, small assembly operations and warehouses.
When considering the purchase of an industrial building, there are several specialty features that need to be considered:
— Is the building located in an area zoned specifically for industrial properties? Special government approvals are often required for certain business uses due to high truck traffic, and 24-hour operations.
— Buildings with easy access to highways, train depots, ports and other form of intermodal transportation tend to command higher lease prices and have lower vacancy.
— Is there ample parking available?
— What is the building ceiling height? Are there loading dock capabilities? Security features such as gated entry and ample lighting?
— Modern industrial buildings require greater and more reliable power. Off-grid backup power may be a necessity.
Warehouses built or remodeled for e-commerce operations tend to have higher employee counts (two to three times more than traditional warehousing) and greater automation compared with more traditional distribution centers. The modernizing of older, industrial properties, along with the need for more local warehousing, has helped stimulate industrial development throughout the U.S. Industrial property development has been greatest in areas with access to qualified labor.
If you’re in the real estate development business, the right financial partner is critical to the growth of your business. Univest’s industrial and warehouse financing ranges from loans starting at $1MM up to $25MM. Manufacturers also can obtain loans of up to $5.5 million to acquire land and industrial buildings through the U.S. Small Business Administration’s Certified Development Company (CDC) 504 loan program.
The lenders at Univest are experienced in this specialized area. Our expert analysis of the property financials and in-house underwriting enables us to assess risks early on to accommodate a smooth and efficient closing. To have a conversation about your lending needs, reach out to us at 215-682-4148.
Univest Bank and Trust Co. is Member FDIC, Equal Opportunity and SBA Preferred Lender.