Industrial Real Estate – Position & Progress In Developing Countries

Apart from retail spaces and offices, the industrial real estate is a major constituent of the commercial real estate. Investment in industrial properties yields better returns for longer periods as compared to other types of commercial real estate properties. There are 3 major types of industrial spaces:

Storage & Distribution – this type is marked by warehouses that are used for the storage and sorting of goods in an appropriate environment. They also involve the distribution and transfer of these goods. The location of the warehouse, therefore, plays a vital role in distribution. For ideal transfers, they must be located in the heart of commercial hubs. They must be secured well as they store hefty assets.

Manufacturing – it is the first and foremost type of real estate land required for industrial usage. The manufacturing of goods that drive our society like edible goods and automobiles is undertaken in various spaces. For example, a car’s windshields are manufactured in different factories by different companies. 

Flex – this type consists of office spaces, research and development labs and space for a showroom that covers up to a third of the space. They are generally customized according to the needs of the firm.

The growing Gross Domestic Product has influenced the surge in the industrial real estate of India and other developing countries. This has, in turn, positively affected the economy of the American economy as well.

The Make in India initiative by the Indian government has led to a boom in the industry where more and more people and organizations are hoping to invest in the sector. There is a frenzy amongst investors to buy land since it implies unprecedented returns. 

Similarly, in China, the government recently showed interests in selling land for the commercial real estate which led to an increase in domestic produce and consumption. However, the unprecedented demand has left the country in a lack of products and goods. Therefore, there is a big market for the industrial real estate in China as well in view of the underperforming manufacturing sector.

Factors affecting Industrial Real Estate

Distribution Centers – these centers are useful for e-commerce companies and others in logistics. They help create a network of strategically placed centers that expedite the process.

E-commerce – it is one of the main reasons that logistics are required on a massive scale. Developed nations like the United States and other countries still developing like India and China, both require efficient industrial properties for distributions and transfers.

Industrial real estate offers, as compared to other industries, high returns with low risk involved.