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Types Of Industrial Properties Explained

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Industrial is 1 of 4 commercial property types (Industrial, Retail, Office and Multi-family) and is a broad category encompassing many different types of buildings with the most common being warehousing and distribution or manufacturing. Below are brief descriptions of 9 industrial property types.

Warehouse / Distribution

Industrial warehouse and distribution building for Amazon.

Warehousing & Distribution buildings are very large, single-story structures used primarily for warehousing and the distribution of business inventory. These buildings range from 5,000 to hundreds of thousands of square feet under roof and have up to 60-foot ceiling heights to accommodate extensive racking and storage systems. These buildings may have a small amount of office space as numerous loading docks, truck doors and large surface parking lots to semi-trailers. Some buildings may be served by rail cars.

Manufacturing

Industrial food manufacturing building producing meals for delivery in Downtown Los Angeles

Manufacturing facilities (also called heavy industrial buildings) are designed to house specialized equipment used to produce goods or materials. In addition to providing three-phase high capacity, electric power, these industrial properties may include heavy ductwork, pressurized air or water lines, buss ducts, high capacity ventilation and exhaust systems, floor drains, storage tanks and cranes. A subset of this is food manufacturing which often includes refrigeration, clarifiers, boilers, sloped floors for drainage, and other specialized food facility equipment.

Refrigeration/Cold Storage

Lineage Cold Storage, Vernon, CA

Refrigeration/Cold Storage are specialized industrial buildings that offer large capacity cold storage such as cooler (34 deg F) and freezer (-10 to 0 deg F) rooms. They are often used as a distribution center for food products such as meat, produce, prepared meals, dairy, etc…

Flex or Showroom

Media Centre Dr
Media Centre Drive

This versatile building type (short for “Flexible”) covers a broad range of uses and often is used to combine one or more uses in a single facility, including office space, research and development, showroom retail sales, light manufacturing research and development (R&D) and even small warehouse and distribution uses. Because of this versatility, flex buildings are sometimes listed as separate category. Flex buildings typically have ceiling heights under 18 feet and have a higher percentage of office space than larger industrial buildings.

Telecom / Data Hosting Centers

CoreSite Data Center in DTLA

These are highly specialized industrial buildings located in close proximity to major communications trunk lines with access to an extremely large and redundant power supply capable of powering extensive computer servers and telecom switching equipment. These buildings have reinforced floor slabs capable of supporting the weight of the electrical and computer equipment as well as backup generators, and specialized HVAC. They may also include raised flooring to handle cooling and extensive cabling. These buildings may also be called Switching Centers, Cyber Centers, Web Hosting Facilities and Telecom Centers.

R&D (Research and Development)

Google Westside Pavilion in Los Angeles, common open campus that internet tech companies like

Flex buildings are popular in high technology industries such as computers, electronics and biotechnology because they effective support a hybrid of office, manufacturing and warehouse space housed in a single location. Often these types of space users prefer locating in campus-like business parks featuring extensive landscaping, shared architecture design, and lots of surface parking and open space.

Biotech (Wet Lab)

Biotech buildings are highly specialized flex buildings that support a range of laboratory space where chemicals, drugs or other material or biological matter are tested and analyzed. This type of building requires extensive plumbing and water distribution, direct ventilation and specialized piped utilities. In addition, some may offer accurate temperature and humidity controls, dust control, and heavy power. Often these types of buildings are located together in campus-like fashion with extensive landscaping, extensive surface parking and open space.

Soundstages – Film & TV Production Studios

Very high clearance Audio Video Soundstage – film and streaming television production

Soundstages are newly constructed and other times developers retrofit existing industrial buildings. These facilities typically have ceiling heights over 30 feet with concrete tilt up walls along with ancillary offices and a commissary for film crews to eat. They are used for film and television production along with commercials, social media, and product videos.

Los Angeles has 50% of the total square footage of production studios and soundstages in North America. Large clusters are in Hollywood, Burbank, and Downtown L.A. In 2023, demand for studio space to create content outpaces supply and availability.

IOS – Industrial Outdoor Storage

Industrial Outdoor Storage example: truck trailer land site

Industrial Outdoor Storage (IOS) is a land site zoned for an industrial use where the tenant can store items outside, most commonly vehicles, construction equipment, building materials, or containers. Most IOS sites have a small building that is generally used as an office and to store tools / parts required for the tenants’ operations. Typical IOS sites range from 3-10 acres of land with a small warehouse building.

IOS also includes truck terminals, which are specialized, low-coverage industrial facilities designed for the maximum throughput of goods. Truck terminals are cross docked facilities where a long-skinny building resides near the center of the site. Goods are not stored in truck terminals but rather moved from one truck to another in the most efficient manner possible. Less-than-truckload (LTL) third-party logistics operators, which combine multiple customers’ freight on a single truck for at least the long-haul portion of the journey, are large users of truck terminals.

Another common IOS use is truck trailer parking, sales, and leasing. And also equipment rentals.

Deal File

Rail Car MFG Building Anchors CleanTech Manufacturing Center

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cleantechAnsaldoBreda is planning to set-up operations in Los Angeles to anchor CRA/LA’s CleanTech Manufacturing Center (CTMC). AnsaldoBreda will bring a new, sustainable facility and nearly 1000 middle-class jobs, as a result of METRO exercising its option to purchase light rail cars from AnsaldoBreda.

The CleanTech Corridor is a four-mile long district on the eastern edge of Downtown Los Angeles that stretches from the Los Angeles State Historic Park (formerly the ‘Cornfields’) at the northern end to the CTMC at the South, including both the east and west banks of the Los Angeles River. The CTMC is located at the intersection of 15th Street and Santa Fe Avenue in the downtown industrial core at the northern terminus of the Alameda Corridor Improvement Project and within the Central Industrial Redevelopment Project Area.

The project will consist of a 240,000 square-foot light rail car manufacturing facility on 14 acres of the CRA/LA-owned, 20-acre CTMC site.  The CTMC is a former Brownsfields Revitalization site purchased by CRA/LA from State of California in 2008 for $14 million with the goal of attracting job rich clean tech businesses to Los Angeles.

Deal File

American Apparel To Continue Operations in Downtown L.A.

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Clothing Maker Inks 10-Year Deal With Landlord Meruelo Maddux

The Downtown-based garment maker American Apparel has reached a 10-year agreement with landlord Meruelo Maddux Properties to stay in its 800,000-square-foot, Warehouse District headquarters, according to American Apparel financial filings.

Although American Apparel’s lease expired in December 2008, it has continued to occupy the pink factory building at Seventh and Alameda streets. The extension comes more than fourth months after Meruelo Maddux, Downtown’s largest landlord, entered bankruptcy.

Prior to reaching the deal, American Apparel, which employs about 5,000 workers at the 747 Warehouse St. factory, was mulling a move. The company considered an old Boeing plant in Long Beach, among other potential new homes, said their real estate broker.

“There were other considerations, other buildings to look at, but Meruelo stepped up,” he said.

American Apparel represents Mereulo Maddux’s largest tenant, both in terms of the size of its space and the value of its former lease.

Terms of the new lease were not disclosed.

American Apparel CEO Dov Charney said the lease was agreed to this month, but declined to comment further on the deal. Richard Meruelo, CEO of Meruelo Maddux, could not be reached immediately Tuesday afternoon.

In addition to housing almost all business operations, the factory has also served as a massive billboard for the company to promote itself and its progressive, often immigration-oriented political messages. American Apparel can also now safely cling to its various mottos touting its “Made in Downtown L.A.” cache.

The building’s sprawling parking lot is also known as the site of festive blowout warehouse sales that draw thousands of young buyers looking for discounted t-shirts, leggings, short shirts and underwear.   by Ryan Vaillancourt, Staff Writer, Downtown News.

Deal File

Forever 21 Purchases Two Large Buildings

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Forever 21, the large garment manufacturer of young women’s clothing, has acquired two large buildings in the past year.  The first building is the 370,000 square foot Overland Terminal facility at the intersection of Alameda St and Olympic Blvd in Downtown Los Angeles with a price of $20 M.  This multistory building has parking and dock high loading.  The second purchase was in the City of Vernon on Sierra Pine Ave.  This collection of several Class B buildings totals near 130,000 square feet.  Forever 21 was the tenant in the buildings and the sale price was approximately $6.5 M.

The company is based in Downtown Los Angeles and occupies several hundred thousand square feet of buildings at Alameda St and 20th St.

Market Trends & Indicators

The City of Vernon And Its Industries

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city-of-vernon-aerial1

The City of Vernon is the smallest among the cities of Los Angeles County when ranked by geographic area or population. The city’s economic impact, however, is far larger than one might expect. Indeed, as one of Los Angeles County’s “industrial cities” – along with the Cities of Commerce and Industry – Vernon is a vital economic center.

Given its industrial profile, Vernon plays its biggest role in the Food Manufacturing area. Vernon-based food product companies employ almost 10,700 workers, more than 15% of the Los Angeles County total for this group. Vernon also plays an important role in the region’s Fashion–Apparel and Textile Design/Manufacturing/ Wholesale industry cluster, with more than 11,200 employees or 10.66% of the L.A. County total.

Other regional industry clusters in which Vernon plays a large role include Furniture and Home Furnishings (with an employment share of 5.53%), Fabricated Metal Products and Industrial Machinery (with 3.4%), Toys (with 2.4%), Auto Parts (also 2.4%), and Wholesale Trade and Logistics (with nearly 2%).

Vernon, due to its historic role as a meat packing center, has long been home to a variety of animal waste processing and rendering industries. Rendering, for those who don’t know, is a process that converts waste animal tissue into stable, value-added materials such as lard, tallow or bone meal. Rendering can refer to any processing of animal byproducts into more useful materials, or more narrowly to the rendering of whole animal fatty tissue into purified fats.

Sources: City of Vernon, California Employment Development Department (QCEW data series), LAEDC.