Inside Logistics

Materials Handling: The flexible warehouse

Real estate considerations


March 2, 2016
by Dave Luton

Dave Luton is a consultant in the Greater Toronto Area.

Dave Luton is a consultant in the Greater Toronto Area.

Flexibility in warehouse design is greatly aided or hindered by the type of real estate you select.

This is particularly true for smaller new organizations that change rapidly and are not always able to determine their future needs. Selecting a flexible warehouse building design is an important element in planning for the future.

There are several considerations in selection of flexible real estate and one of them is affordability. The flexibility will add some expense but it should not result in excessive cost.

The first components of flexible real estate are those related to the site. Three of the most critical of these are zoning, transport vehicle access and working space, and surprisingly, parking. Transport vehicle needs we will cover with building design.

Most municipalities have at least two classes of industrial zoning, which we will classify as heavy industrial and light industrial. Examples of heavy industrial uses include steel mills or refineries; these are uses you don’t want next door to your warehouse.

You also don’t want to have residential uses in close proximity to your site because they will tend to restrict the hours of operation. Today your facility must be capable of operating on a 24-7 basis, and nearby residential uses will restrict this.

The zoning for a flex space warehouse is typically light industrial, defined to permit office, warehouse and light manufacturing uses. It is sometimes classified as production, distribution and repair (PDR) use, but many types of repair uses may not be suitable for other nearly users. An example is automotive repair (eg body shop.)

It should be broad enough to permit a large range in the volume of any use occupancy, but screen out any objectionable uses that will interfere with a neighbouring office use. You don’t want a neighbouring use that gives off odours (eg a slaughterhouse) or noise. Vibration, from a rail line, for example, is also a concern for some types of warehouse or manufacturing use.

For parking, you want a surplus of parking spaces in case the office proportion of your use increases to a level beyond that originally expected. For some uses, for example an e-commerce business with a large call centre, the office maybe larger than the normal 10 percent commonly allowed with these types of buildings. One thing to watch for is if the zoning permits auto sales because your surplus parking will disappear right away.

The basic building design is the next crucial component for the flexible warehouse. Generally it is a single storey industrial building. The first consideration is external segregation of office space from manufacturing and warehouse space. Thus the office space needs are concentrated on one face of the building (preferably facing the street or one with a pleasant view). Finishing at the front is generally superior to that on the rear industrial walls. At the front door is likely to be traditional street-style landscaping.

At the rear of the building is concentrated the transport interface for industrial or warehouse uses. These should have a dedicated, segregated off-street entranceway and have sufficient backing and turning space for today’s longer transport trucks. The wall should be designed to permit the retrofit of additional truck docks, and pedestrian door(s) should be available.

For warehouse use the building should be high enough to get reasonable vertical occupancy and permit the retrofit for a second storey office or industrial work platform (commonly called a mezzanine). This generally means from 20 to 30 feet clear height but not high enough to require in-rack sprinklers. This is higher than many older industrial flex buildings but greater land costs today justify the higher cube potential.

The roof should be strengthened to support the additional air conditioning needs of expanded office space and the slab should be strong enough to support warehousing uses throughout.

In general, a flex building should be over-specified from a utility perspective to allow for the increased office occupancy. This means additional electrical hydro capacity and high-speed Internet, along with additional roughed-in water and plumbing for additional washroom needs of the increased office space.

Office space designs in some types of flex buildings should be universally assignable, as often today except for management, work spaces are assigned on a daily basis. This allows for higher occupancy because an employee is only assigned to the space for a day at a time.

One often overlooked point that is a large concern with employees in a flex office space environment is cleanliness. It is important in a flex space environment to have a strong cleaning staff.

Taking all these considerations into account when planning for a new warehouse space will give you maximum flexibility with minimum extra costs, and hopefully the new space will serve your business well for as long as planned.