Industrial building construction refers to the development, renovation, or ground-up construction of facilities meant for manufacturing goods. These buildings can include factories, power plants, distribution centers, warehouses, and other specialized facilities available for sale or rent. Besides, the design, installation, or maintenance of mechanical and structural components in an industrial building is also part of an industrial construction project.
The main functions of industrial buildings include product manufacturing, assembly, power production, storage, distribution, mining, and research. Industrial buildings come in a variety of forms and sizes. For example, a general warehouse and a data center hosting cloud computing services are both recognized as industrial buildings.
According to CommercialEdge’s National Industrial Report, around 463 million square feet of industrial space is under construction nationwide, making up 2.4% of the total existing industrial stock.
In this blog, explore what industrial buildings are, the different types of industrial spaces, and their unique characteristics. Additionally, understand the steps in industrial construction and the latest trends emerging within the sector.
Characteristics of Industrial Buildings
- An industrial building usually has open floor plans, high ceilings, and natural light.
- Functionality is prioritized over aesthetics. Structures are built to support heavy equipment.
- Compliance with strict guidelines and legal regulations.
- Fulfillment of permitting and occupancy requirements to comply with standards from local, state, and federal agencies.
- Industrial buildings are mostly located on the outskirts of a city or town.
- Consist of special conveyance that allows 24/7 shipping and receiving air or railroad transportation, or access to highways.
Industrial Building Types Explained
Industrial buildings are mainly divided into three main categories – manufacturing, storage & distribution, and flexible space. Each of these industrial building types has individual characteristics and serves different purposes, depending on its space and available resources. Let’s examine these three industrial building categories and their subcategories one by one:
A. Manufacturing Buildings
One of the most common types of industrial facilities is a manufacturing building. Manufacturing buildings are designed to house equipment used to produce goods or materials. For example, oil, mining, and shipbuilding businesses. Manufacturing buildings range from small single-story warehouses to large multi-story factories.
Characteristics of Manufacturing Buildings:
- This type of industrial building has enormous space for production equipment
- According to NAIOP, the Commercial Real Estate Development Association, a manufacturing facility has typically less than 20% of office space
- Clear heights of at least 10 feet and high ceilings to accommodate overhead cranes and other machinery
- Manufacturing buildings have heavy-duty floors to support heavy equipment
- Multiple loading docks for trucks to receive raw materials and ship finished products
1. Heavy Manufacturing Buildings
Production of heavy-duty goods like automobiles, steel, cement, or outdoor equipment takes place in a heavy manufacturing building. Thousands of square feet of space are available for storing raw materials and finished products in these industrial buildings.
Generally, heavy manufacturing facilities contain heavy-duty equipment, three-phase electricity, and ample loading dock space. Depending on a company’s needs they may also have customized drainage, pressurized air, and water lines, cranes and storage tanks, ductwork, ventilation systems, chemical lines, etc. Heavy manufacturing buildings are built to suit, which means a steel manufacturing building cannot be used to make cement. In case the structure needs to be changed, the entire industrial building will be renovated because of the permanent fixtures needed to produce specialized products.
2. Light Manufacturing Buildings
Light manufacturing buildings, unlike heavy manufacturing buildings, are used by businesses that assemble small goods and materials. For example, electronics manufacturers, toy companies, textile production, and furniture companies. These industrial buildings are smaller in size and lighter than heavy manufacturing buildings.
Characteristically, light manufacturing buildings have modern storage space and a spacious office area for administrative functions. They require fewer materials, space, and power to operate. Products are stored and shipped in light manufacturing buildings using lighter, portable equipment that can be easily reconfigured for new tenants.
B. Storage and Distribution Buildings
As the name suggests, storage/warehouse and distribution centers serve the purpose of storage and transportation of goods from a centralized location to end consumers. These goods can be raw and packaged materials across sectors such as agriculture, manufacturing, healthcare, food and beverages, etc. These industrial building types benefit manufacturers, exporters, importers, people involved in wholesale business and transport, etc.
Warehouse properties are classified into six categories – general warehouse, cold storage, hazardous material warehouse, specialized warehouse, distribution warehouse, and trick terminals.
The rise in e-commerce sales since the COVID-19 pandemic has significantly boosted the demand for warehouse spaces.
A CBRE research study found that for each $1 billion in growth in e-commerce sales, there requires an additional 1.25 million square feet of warehouse space.
Characteristics of Storage and Distribution Buildings:
- Single-story structure that is 50,000 to hundreds of thousands of square feet large with high ceilings, multiple loading docks, large parking lots, and concrete truck courts.
- About 80% of the square feet space is assigned to storage space and 20% of the square feet space is dedicated to offices.
- Up to 60-foot high ceilings to accommodate huge racking and storage systems.
- Some warehouses are climate-controlled to shield sensitive materials from temperature extremes.
- Most storage and distribution buildings are located near city center and airports for quick product deliveries.
1. General Warehouse Buildings
General warehouses are industrial buildings primarily for storing a variety of goods and materials and not for distribution. Here, the goods are kept for longer periods of time, hence, neither the building’s location is an important factor, nor its door-to-square footage ratio, since products aren’t frequently moved in and out. The design of general warehouse buildings depends on the goods they store, and the prices of these goods also vary by storage facility. For instance, cold storage is equipped with entirely sealed and insulated freezers to maintain a low temperature.
2. Refrigeration/Cold Storage Buildings
Cold storage buildings are single-user industrial properties equipped to hold large-capacity coolers and freezers. They are specially built for large-scale national food distribution and manufacturing companies.
Cold storage facilities require seals on their docks and insulated overhead doors to keep products cold. A specialized foundation is laid because the freezing, often sub-zero, temperatures in the coolers can cause slabs to crack. Cold storage industrial buildings are located mostly near state and national highways and in places with a sufficient supply of electricity.
3. Hazardous Material Warehouse Buildings
Hazardous materials (HAZMAT) warehouses are used to store biological, chemical, radiological, and/or physical hazardous materials. These industrial materials can be flammable, corrosive, or dangerous to living beings and the environment. Highly specialized industrial buildings like these need to follow safety protocols set by various regulatory bodies.
A warehouse operated by a third-party logistics provider (3PL) must be certified to handle hazardous materials. As per OSHA, not more than 60 gallons of Class 1 (explosives) or Class 2 (hazardous gases) material and not more than 120 gallons of Class 3 material (flammable liquids) should be kept in a single storage cabinet. HAZMAT buildings include special features to protect workers and the surrounding community from these hazards.
4. Specialized Warehouse Buildings
Warehouses dedicated to storing specific types of materials that require special attention are called specialized warehouse buildings. Among them are art storage warehouses, oil, and chemical warehouses, automobile storage warehouses, whiskey wine storage warehouses, etc. To protect items from any damage or spoilage, industrial construction companies have to install highly developed facilities in such warehouses. In fact, the storage of explosives like fuel is governed by strict regulations. Because of the distinctive nature of individual businesses, these specialized warehouses are custom-built.
5. Distribution Warehouse Buildings
Bulk distribution warehouses are industrial buildings storing large quantities of a single product. They are often outfitted with conveyor belts, packing and shipping machines, and robotic arms. As the name implies, distribution warehouses are fundamentally used for shipping goods, so their location is crucial. Ideally, a distribution warehouse should be located near the middle of the country, equidistant to its buyers, or close to transportation hubs like airports, ports, and railroads.
6. Truck Terminals
A truck terminal or cross-dock facility is an industrial building type used to store and service trucks, facilitating the movement of goods along the supply chain. This industrial building acts as an intermediate loading and unloading station for transferring goods from one truck to another. Truck terminals have the least amount of storage space of these industrial building types. More emphasis is put on features such as large parking spaces for trucks, service bays for maintenance and repairs, and fueling stations. Usually, truck terminals are located near highways or other significant transportation routes.
C. Flex Space Buildings
Flex space buildings are by design ‘flexible’ which are used for multiple purposes and can be easily refurbished to meet evolving business needs. It is a type of industrial building that encompasses office space, production space, and storage space all in one location. Flex buildings are the most suitable choice for startups because their rates are lower than traditional office space and they can facilitate more parking space than bulk warehouse buildings. Hence, flex spaces are perfect for startups eyeing cost-effective industrial buildings for sale or rent.
There are three types of flex spaces – research and development (R&D), data centers, and showrooms.
Characteristics of Flex Space Buildings:
- Over 30% of the industrial building’s space is reserved for office use and there is ample parking.
- Flex buildings usually have a slightly lower ceiling clear height (14 – 24 feet).
- Features office space, conference rooms, production areas, storage areas, and shipping and receiving docks.
- Loading areas can be dock high or ground-level, and older buildings may even have semi-docks (2 ft) to accommodate smaller box trucks and vans.
- Larger parking space and better landscaping than other industrial properties.
1. Research and Development (R&D) Buildings
Flex buildings are much preferred in high-technology industries such as computers, electronics, and biotechnology because of their hybrid nature. Hi-tech industrial companies build research and development centers to create, test and improve new and existing products.
Unlike the typical bare flex spaces, R&D centers have a campus finished with eye-pleasing architecture and landscaping, shared workspaces, and plenty of open space. Advanced industrial spaces like these require more power than other buildings to test equipment and feature fire suppression systems, and extensive security systems.
2. Data Center Buildings
Data centers are dedicated industrial facilities that keep the internet running and make cloud storage accessible for large companies. On average, they are about 100,000 square feet spacious housing an extensive number of computer servers and telecom switching equipment.
To protect the data center’s equipment from damage or overheating, effective cooling systems, HVAC, and security systems are in place. Additionally, there are redundant power supplies (one or two units) to ensure smooth technology running during any power outage. Data centers are designed with reinforced floor slabs to withstand heavy loads from network equipment.
3. Showroom Buildings
A showroom building is a perfect example of a flex building that combines a retail display area, storage space, and office space. As a general rule, more than 50% of the industrial building area is used for displaying and selling products. Merging retail charm with functionality, showroom buildings are attractive prospects for tenants or owners seeking dynamic industrial buildings for rent or sale.
The most common examples of showroom buildings are car dealerships, furniture companies, automobile showrooms, and electronics stores. Showrooms are located in bustling areas such as shopping malls, industrial parks, and business parks.
Constructing an Industrial Building From Start to Finish
Constructing an industrial facility involves thorough planning and execution. Leveraging our several years of experience in building manufacturing plants, refineries, and warehouses, we handle the complexities of industrial construction, ensuring timely and quality delivery.
From initial planning to post-construction reviews, here is the step-by-step process of constructing an industrial building:
Step 1 – Planning and Design
Industrial construction begins with a planning phase, where contractors assess your specific needs and create a tailored plan. They ensure all industrial requirements are met, such as load-bearing capacity, ceiling height and clearance, as well as the number of bays for truck transportation. Designing the industrial facility requires considering the HVAC systems, electrical setups, and safety measures adhering to OSHA standards.
Step 2 – Pre-Construction Stage
During the pre-construction stage, industrial contractors procure high-quality materials from reliable suppliers for timely delivery. They perform site inspections and environmental assessments like soil conditions and ground stability to modify the structural design, making sure they comply with local regulations and obtain necessary building permits.
Step 3 – Construction Process
During the construction phase, the team of an industrial contractor strictly follows safety protocols due to the hazardous materials and equipment like grinding machines, forklifts, and pressurized containers involved. At each stage of the industrial construction process, they conduct quality assessments to check if the subcontractors have met all specifications while maintaining structural integrity or safety. The focus of industrial contractors is on executing the construction plan within the deadline.
Step 4 – Post-Construction and Review
After construction, the industrial project undergoes thorough inspections to check electrical systems, plumbing, air quality checks, and structural foundations. For example, failures in pipeline installations of an oil refinery are resolved to prevent future leaks or spills. A post-construction review ensures that the facility meets all specified requirements and is ready for industrial operations.
Constructing an industrial building demands expertise and flawless coordination so that the construction project meets all specifications, is delivered on time, and adheres to the highest quality and safety standards.
Future Trends in Industrial Construction
Here are six key trends in industrial and manufacturing construction, focusing on design and operational efficiency:
Larger Warehouse Space
Manufacturers are moving away from “just-in-time” delivery due to supply chain disruptions, leading to increased demand for larger warehouse spaces. This industrial construction trend requires the need for more inventory on hand, requiring additional space for storage and material handling. Industrial companies are focusing on constructing warehousing facilities close to production sites to mitigate long lead times.
Modular Buildings
The trend of constructing modular offices in industrial facilities promotes a cohesive work environment by merging office space with production areas. This kind of prefabricated building is constructed offsite and assembled onsite, allowing for quick integration with existing industrial facilities. This industrial construction trend saves on labor costs and causes minimal disruption during installation.
Sustainable Building Design
Another emerging trend in industrial construction is designing LEED-certified structures. Sustainable building practices include the use of locally sourced materials, energy-efficient appliances, and designs that minimize environmental impact. Additionally, industrial contractors are using smart technology and water conservation measures to make industrial buildings environment-friendly.
Flexible Factories
To adapt to rapid market changes, manufacturers need versatile industrial facilities that can handle various product lines. This includes adaptable manufacturing areas and hybrid office designs, which can be quickly reconfigured to meet evolving demands. For example, a pharmaceutical company designs its production areas with mobile clean rooms and flexible equipment setups, enabling shifts between different drug productions.
Advanced Materials and Building Techniques
Innovative materials like self-healing concrete and high-performance composites are becoming popular among industrial construction companies today. These construction materials offer improved durability and maintenance benefits, reducing long-term costs and enhancing building performance.
Technology Integration in Industrial Construction
The use of AI and drones is revolutionizing safety and efficiency in industrial construction. Drones aid in site surveying and progress tracking, while AI enhances project management through better scheduling, cost estimation, and risk assessment.
These industrial industry trends reflect that more manufacturing companies and contracting businesses are inching toward efficiency, sustainability, and adaptability in industrial construction.
How to Find a Suitable Industrial Building for Rent?
Renting an industrial space that will meet business needs is a major decision for investors and company owners. By assessing the nature of your business operations, employee requirements, and existing conditions of the industrial facility, you can rent a suitable space for future business growth.
Below are the top considerations for finding a suitable industrial building for rent:
Location – Your industrial building should be located in an area convenient for your employees, suppliers, and customers. Ensure the location is in proximity to transportation hubs and is accessible for trucks.
Size and Layout – Determine the square footage and layout requirements you are looking for in an industrial building. Are you finding a commercial warehouse space or an industrial space? Evaluate the ceiling height, floor load capacity, and office space requirements. Higher ceilings and loading docks may increase the rental rates.
Infrastructure and Amenities – Check if essential utilities such as power supply, water, and ventilation systems are installed in compliance with industrial regulations. Whether you rent an industrial building in an urban or suburban area, there should be enough parking space, accessibility, and security features.
Lease Terms – Extensively review your lease terms, including rental rates, lease duration, utilities, and maintenance terms. Rental rates for industrial buildings depend on different factors like location, size, existing condition, type of industry, and local market trends.
The national average industrial rental rate stood at $7.15 per square foot. Investors must understand factors affecting industrial rental prices to negotiate favorable lease terms.
Engage with commercial real estate brokers or an experienced general contractor having local knowledge to find industrial spaces available for rent.
To Conclude
Every company, be it a factory, manufacturing firm, logistics business, or retail business, looks forward to growing. Finding the right industrial building that fits your business needs is paramount to your success. While most industrial building types, from manufacturing, distribution centers to flex buildings, have their similarities, it’s wise to note their differences to pick the best space for you. Whatever option you choose, evaluate the company’s needs, assess growth plans, estimate the budget, and envision your future growth.
Constructive Solutions, Inc. has worked in the industrial construction industry for several years and prides itself on its competent team of professionals. We build all types of industrial buildings right from the ground up and renovate existing ones to maximize space and functionality.
If you are planning to construct new industrial real estate, contact our experienced team today.
FAQs
What is industrial architecture?
Industrial architecture is a type of architectural style used for the design and construction of structures in the industrial sector. For example, warehouses, factories, steel mills, distilleries, etc. Industrial-style architecture and interior design focus on functionality, the use of rough materials, and open floor plans with high ceilings.
How can I find industrial buildings for lease in my area?
Start by searching online “industrial buildings for rent” or “industrial buildings for rent near me”. Reach out to commercial real estate agencies specializing in industrial properties. You can also have discussions with property management companies to gain valuable insights.
What are steel industrial buildings and how are they unique?
Pre-engineered industrial steel buildings are made up of galvanized steel frames combining the main frame, roof, and walls. Steel buildings are popular in industrial construction because they are flexible, durable, quick to manufacture, and possess high corrosion resistance. Additionally, the cost per square foot of steel industrial buildings is quite affordable ($10 to $25 per square foot).
Relevant Resources:
- Difference Between Industrial and Commercial Construction
- Designing an Industrial Facility for the Tenants You Want to Attract
Constructive Solutions, Inc. is a full-service commercial construction company serving San Francisco and Bay Area.
Whatever your vision, we have the resources, experience, and insight to make your concept a reality, and a space where your business can flourish.
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