The automotive warehouse real estate market has taken a major hit, but it remains a dynamic sector where the requirements are becoming more and more specific,
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The world’s automotive industry has had a torrid three years: demand has plunged, production has been slashed, plants have been shuttered, and once-iconic brands have been sold-off.
But spare a thought for an industry that has had an even tougher time: the providers of warehousing space for automotive logistics. These are firms that build, develop and lease automotive warehousing space–either speculatively, or to serve specifically-identified client needs.
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As with other parts of the commercial property market, the industry has a capital intensive business model, making large bets on land values and the demand for specific locations, banking on making a return from capital appreciation and a steady income stream in the form of lease payments.
Get it right, in short, and there is serious money to be made. Get it wrong, and trouble can loom with shocking speed.
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