What is industrial property?
Industrial property is about buildings and lands that are used for industrial activities such as production, manufacturing, assembly, warehousing, research, light storage, data centres, and distribution.
Types of industrial properties
The pandemic has changed the trend of industrial property. Many investors notice this opportunity and change industrial real estate into medical use laboratories for healthcare purposes as well as data centres.
Some companies also decide to repurpose their warehouses to become light manufacturing facilities, manufacturing retail and business consumers.
Furthermore, warehouses also increasingly turn into food manufacturing facilities, which make and process food and beverages for restaurants and grocery stores. The central kitchen concept has been booming lately due to economies of scale for food businesses.
Also, industrial real estate is used for temperature-controlled facilities such as cold storage to distribute food and beverages. For instance, SK Cold Chain Solution, HTH corporation, and Tiong Nam logistics have their industrial real estate for cold storage purposes.
Advantages of Industrial Properties
Strategic location
Mostly easy access to seaport and logistics
Industrial land prices will go up due to scarcity of land in prime location
Easy to obtain long-term tenants (Mostly 3-10 Years)
Steady income as tenants often signed long-term tenancy agreement or contract
Disadvantages of Industrial Properties
Sometimes owners might have difficulties in finding another tenant when the original tenant leaves
High threshold as higher cost needed
Not all industrial properties are in demand - sometimes hard to find the right tenant
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