There have been some significant changes recently in what Houston’s industrial tenants want. Experts at Bisnow’s industrial real estate event yesterday laid out some ways building warehouses is different from just a few years ago.
Way Bigger Truck Courts
Even five years ago, most Houston tiltwall projects were satisfied with 130-foot truck courts. Now Duke Realty SVP David Hudson (with IDV’s Steven Carter at our event) says most users want at least 180 feet, and some investors won’t consider anything less than 185. Some users are also expanding car storage. It’s been a huge and rapid change; our moderator Pape-Dawson Engineers VP Michael Preiss says projects his firm designed two years ago thinking they were ahead of the curve are coming back saying they’re short on storage. The expanding truck courts will push rents up, David says.
Clearance Shoots Up...If It Can
The industry standard is 32-foot clear heights, but David says now tenants (especially ones related to e-commerce) are asking for 36 to 40 feet. That’s causing problems. First of all, sprinkler codes make it almost impossible to go above 34 feet in Houston. Second, Arch-Con SVP Jason Cooper says companies with hazardous materials, including petrochem firms, need lower heights. The east side of town gets both the e-commerce distribution groups and the petrochem tenants, but your clear height could cut out one or the other unless you can build very flexibly. Pictured: 300 attendees joined us at the new Hyatt Regency Houston Galleria yesterday.
More Code Hurdles
Those sprinkler codes aren’t the only ones causing major headache for industrial developers and architects. Energy Architecture senior project manager Alan Creech says new codes are making even typical construction harder. For example, Pearland just changed its codes about insulating warehouses. Alan’s second from the left here with our panel: David, Vigavi Realty managing principal Luis Rene Garza Villareal, Clay Development owner Robert Clay, Jason and Michael.
Alan says companies often come to his firm to design build-outs after they’ve signed leases, and sometimes their requirements can’t be met in the space they’ve chosen, or they require massive, majorly expensive overhauls like redoing all the power or insulation. It’s especially important for specialty manufacturers and labs to bring on a design team before they pick a space so they know what can actually accommodate what they’re envisioning.
