You may have heard the term “flex space” before, and it is important to know the significance in flex space in commercial real estate.

In fact, for the beginner and expert real estate investor, flex space can be a great gateway into the industrial real estate realm as it is extremely versatile in the way it can be used and with the many businesses that these spaces can house.

Flex industrial, characterized by multi-functional spaces that can be easily adapted to meet the needs of various businesses, offers a unique and attractive investment option.

Here’s everything you need to know about flex space.

What Is Flex Space?

Flex space can be loosely defined as any building (typically single story) that has some sort of combination of warehouse space with office/retail space.

These units often have a warehouse door or loading dock with a higher ceiling height – typically around 14-16 feet tall.

Flex warehouses come in all shapes and sizes and, because they have such variable uses, these types of buildings are very attractive to an array of businesses seeking space.

What Types Of Businesses Lease Flex Space?

Flex space makes for a great investment because of the wide variety of uses that are able to occupy the space. Here are a few examples of businesses that would lease flex space and how they would use it:

E-commerce Fulfillment Centers:

E-commerce companies need special warehouses to store their products, manage orders, and handle shipping and delivery efficiently. These spaces provide the storage, tools, and logistics systems needed to support online shopping.

Light Manufacturing Units:

Small-scale manufacturers often seek flex industrial space to conduct their operations. These businesses typically involve the production of goods on a smaller scale, such as artisanal products, custom manufacturing, or prototyping. They require flexible space that can accommodate their machinery, assembly lines, and storage needs.

Distribution and Logistics Companies:

Distribution and logistics companies, including third-party logistics providers (3PLs), rely on flex industrial space to handle the movement and management of goods across various supply chains. They require space for tasks like receiving, sorting, quality control, storage, packaging, and outbound shipping. Flex spaces enable them to adapt to changing demands and handle multiple clients simultaneously.

Research and Development (R&D) Facilities:

Companies in industries such as technology, pharmaceuticals, and biotechnology often seek flex industrial space to establish R&D labs. These facilities are equipped with specialized equipment, controlled environments, and collaborative areas to conduct experiments, product testing, and prototype development.

Food and Beverage Production:

Businesses in the food and beverage industry, including caterers, specialty food manufacturers, and craft breweries, may lease flex industrial space to prepare, produce, and store their products. These spaces provide commercial-grade kitchens, storage areas, and temperature-controlled facilities for efficient food production.

Art Studios and Creative Workspaces:

Artists, designers, and other creative professionals often require flex industrial space for their studios and workspaces. These spaces offer natural light, ample room for artistic endeavors, dedicated storage areas, and communal spaces for collaboration and exhibitions.

Fitness Centers and Gyms:

Fitness centers and gyms frequently seek flex industrial space due to their spatial requirements and accessibility needs. These spaces provide large open areas for workout equipment, designated spaces for classes, changing rooms, and office areas for administrative functions.

Auto Repair and Body Shops:

Automotive repair and body shops require flex industrial space equipped with specialized tools, lifts, and paint booths. These spaces allow mechanics and technicians to efficiently perform repairs, maintenance, and restoration services on various types of vehicles.

This list is by no means all-encompassing. Just about any business could take advantage of the opportunities that flex space offer.

Advantages Of Flex Industrial Space:

Versatility

Flex industrial space offers a versatile layout that can be easily modified to meet the specific needs of various businesses. It allows for a combination of office, retail, and warehouse space within the same unit, making it suitable for a wide range of commercial activities.

Cost-effectiveness

Compared to traditional office spaces, flex industrial space typically has lower rental rates, making it a cost-effective option for businesses. Additionally, the combined office and warehouse space eliminates the need for separate leases and reduces overall operational costs.

Customization

Flex industrial space allows tenants to customize the layout and design of their workspace according to their requirements. This flexibility empowers businesses to optimize their operations, whether they need more office space, increased storage capacity, or a combination of both.

Central Location

Many flex industrial spaces are strategically positioned in central locations near major transportation hubs, highways, and urban centers. This ensures easy access for employees, suppliers, and customers, which can be advantageous for logistics-driven businesses.

Scalability

Flex industrial spaces often come in a range of sizes, allowing businesses to expand or downsize as needed. This scalability feature caters to startups and growing companies that anticipate changes in space requirements as their businesses evolve.