Liz Young of The Wall Street Journal reports that beneath the growing availability of U.S. warehouses lies a tight supply of buildings under 100,000 square feet. Half Price Books has been unable to find a small 6,000-square-foot warehouse in the Minneapolis-St. Paul area for over a year due to a shortage of available spaces. This is part of a broader issue, as demand for small warehouses exceeds supply. Young writes:
Half Price Books has been looking for a new warehouse in the Minneapolis-St. Paul region for more than a year with no luck. The problem: The Dallas-based discount retailer needs too little space.
Kathy Doyle Thomas, the company’s president, said Half Price Books has been searching for a suitable replacement for its 6,000-square-foot warehouse, which its longtime landlord leased to another tenant last year. So far, the used-book seller, which operates more than 110 stores nationwide, has been relying on temporary storage units because “there is nothing on the market,” Thomas said.
Half Price Books is among a growing number of businesses that are struggling to find small warehouses to lease. […]
The vacancy rate for U.S. warehouses under 100,000 square feet was 3.9% in the fourth quarter, far below the 6.7% overall vacancy rate, according to real-estate services firm Cushman & Wakefield. That was also less than half the 10.1% vacancy rate for buildings of more than 100,000 square feet. […]
Half Price Books said its inability to find suitable space in Minnesota prompted the company to start looking for warehouse space in other regions well before its leases are up. The company is also searching for ways to be more efficient and reduce the space it needs, Thomas said.
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