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1

Industrial properties
2 Broad Categories

Industrial buildings are often described as falling into one of two broad categories: light to medium industrial and heavy industrial or special purpose.

2

Common examples of light to medium industrial buildings are as follows:

Common examples of light to medium industrial buildings are as follows:

• General purpose storage warehouse — may be single- or multi-tenanted

• Distribution warehouse

• Light manufacturing

• Automotive and truck repair shop

• Commercial sales and storage

• Lumber yards

• Big-box retail stores

• Flex buildings combining significant office and display space along with warehouse space

3

Explain / describe Heavy Industrial Buildings

Heavy industrial buildings generally house some form of capital manufacturing, assembly, or process associated with the petrochemical, mining, and oil and gas industries. 

4

Examples of Heavy Industrial

Examples of heavy industrial buildings are as follows:

• Auto manufacturing plants

• Ship building and fabrication plants

• Plastics and chemical manufacturing plants

• Mineral extraction plants involving smelting, crushing, and concentration

• Oil and gas refineries and related buildings

• Pulp and paper manufacturing

• Sawmills and speciality forest product plants

• Livestock rendering plants and other food plants

• Steel manufacturing

• Concrete and asphalt batch plants

• Metal recycling plants

5

Defining attribute of heavy indusrial buildings?

A defining attribute of heavy industrial buildings is that they are generally designed to fulfil a specific industrial process associated with a specific industry such as the forest industry, oil and gas, or manufacturing sectors. 

6

Why are Heavy Industrial Buildings difficult to adapt to different purposes?

These buildings are often difficult to adapt to different purposes once the original use for which the building was designed has ended — giving rise to the special purpose nature of the improvements. When the original use for these buildings has ended, there is often considerable obsolescence in the building shell since the cost of conversion to an alternative light industrial or commercial use is very high, especially when remediation of site contamination (associated with former use) is required. The economic life of the building is closely tied to the economic life of the industrial equipment and machinery (the industrial process) that the building houses.

7

Another factor that distinguishes light to medium industrial from heavy industrial buildings?

Another factor that distinguishes light to medium industrial from heavy industrial buildings is the impact of the processes and uses that occur within the building.

 

For example, smelting, steel, chemical, and pulp manufacturing have high environmental and human impacts, and attract very high levels of monitoring and controls.

 

These uses attract the strictest land-use measures through zoning and other controls. In contrast, light and some medium industrial buildings and related uses may be found in a wider range of locations within a typical North American city since the environmental and human impact is far less.

8

Defining characteristics of a manufacturing building?

The defining characteristics of a manufacturing building are heavy sub-structures and floor systems (to support heavy machinery loads), high ceilings with travelling craneways, large bay doors (14 to 16 feet), and high capacity electrical service.' There may be distinctly different sections in a building, with varying ceiling heights, clear spans or bay sizes, interior and exterior finishes, construction materials, and building services.

9

Discuss examples of obsolescence in the pulp and paper industry

Examples of obsolescence are common in the pulp and paper and forest products industries.

 

A number of pulp mills in eastern Canada have shut down due to declining pulp markets and high production costs relative to lower cost producers in the US and western Canada.

 

Industrial (special purpose) buildings housing the equipment required in the manufacturing process such as the steam and recovery boiler and pulp digesters often become obsolete at the same as the equipment, with replacement of the equipment sometimes leading to the demolition of the associated buildings.

10

Warehouses are used to store materials pending their shipment off-site. Again, the proportion of space allocated to specific uses will vary, but a typical ratio is  _ _ _ _ _ _ _ _ _ _ _

Warehouses are used to store materials pending their shipment off-site. Again, the proportion of space allocated to specific uses will vary, but a typical ratio is 10% office space and 90% warehousing. 

11

The US Whole Building Design Manual lists three main types of warehouses, as follows:

The US Whole Building Design Manual lists three main types of warehouses, as follows:

• Heated and unheated general purpose warehouses that are intended to provide bulk, rack, and bin storage, and space for shipping and receiving, packing, crating, etc.

 

• Refrigerated warehouses that provide cold storage for perishable food and other goods. This includes chilled and freezer space.

 

• Controlled humidity warehouses that are similar to general warehouses with the inclusion of vapour barriers to maintain humidity at target levels.

12

Differences between Warehouses &
Distribution Centres

Warehouses store goods for varying periods, whereas distribution centres are designed for the movement of goods. They are built to accommodate the requirements of modern materials handling techniques.

 

As such, distribution centres typically have more docks and loading doors, usually along a minimum of two walls, and will have lower site coverage to facilitate the manoeuvring of trucks and allow for the parking of trailers or containers.

13

Define Cross Docking

Cross-docking is a practice in logistics of unloading materials from an incoming semi-trailer truck or railroad car and loading these materials directly into outbound trucks, trailers, or rail cars, with little or no storage in between.

14

Describe Flex Industrial

 

A significant development in recent years involves the construction of buildings intended for a combination of commercial and industrial tenancies, often with condominium/strata' title tenure.

 

Flex industrial buildings are defined as those "designed to be versatile and may be used in combination with office, research and development, quasi-retail sales, industrial processing, or high tech".

15

Describe Typical Flex Buildings

Flex buildings are usually one or two storeys high with at least half the space designed for office layout, ceiling heights can go up to 16 feet, and the majority of units have overhead doors (either grade level or dock high delivery doors). Flex industrial space provides versatility — tenants can build out additional office space with drop ceilings and create showrooms, while still having relatively high ceilings for production, processing, or warehousing.

 

Office space in flex buildings is usually about 10% of total floor area, and it may be located in a two-storey portion at the front of the building. If the business is sales-oriented, the main floor of the office area will typically be used for display or sales purposes.

 

The remainder of the building is usually clear span, general-purpose light manufacturing, warehousing, distribution, and shop space.
Developers of industrial multi-tenanted (e.g., rental) buildings often prefer to keep the costs low, in comparison to industrial multi-tenanted buildings (generally condominium/strata-title) developed for sale, which often have a higher quality of finish to enhance appeal.

 

16

NOTE ONLY

There are a number of specialized warehouse and distribution properties. A cross dock warehouse is designed to quickly redistribute containers or other shipments for movement into local markets and vice versa. Cross dock facilities located near borders will have sections that are "bonded" or pre-cleared to pass through customs.

NOTE ONLY

There are a number of specialized warehouse and distribution properties. A cross dock warehouse is designed to quickly redistribute containers or other shipments for movement into local markets and vice versa. Cross dock facilities located near borders will have sections that are "bonded" or pre-cleared to pass through customs.

17

Describe Prestige Industrial

Some modern production facilities blur the distinction between industrial and commercial real estate, such as software and high-tech manufacturers (where the premises resemble fully finished office space), television and music studios, and high-fashion distribution outlets. Since these businesses involve high-paying jobs and have an element of prestige, planners encourage these uses and they tend to compete for quality locations.

 


Prestige industrial facilities are high quality developments, with substantial office space, and are usually located in a controlled industrial park. Features might include large computer rooms and specialized areas for activities such as high volume data processing. There will be limited storage or manufacturing space. Prestige industrial buildings are often multi-tenancy and can involve structured parking. Exposure and location are frequently significant factors affecting their appeal.

 

18

APRON SPACE

The space required for a transport truck to manoeuvre and reverse into a building loading bay is called apron space. 

19

MINIMUM APRON SPACE

According to industry standards, a transport truck with an overall length of 65 feet requires a minimum apron space of 135 feet'.

20

LOADING FACILITIES NOTES

Loading facilities may be either dock height or at grade level. Docks typically have mechanically operated levelling to provide for ease of forklift access from transport trucks into the warehouse and vice-versa. Loading bay doors may open manually, electrically, or automatically, occasionally with safety features or automatic dock height levelling devices to facilitate loading and unloading trucks.


Loading bays to a plant or warehouse should normally be under cover. For warehouses, often the roof is carried out 8 feet to 10 feet to form a canopy. Under this canopy, a loading dock is built to the normal height of the tailgate of a truck or to deck height if the loading is to a flat or box car. Some properties may have a railway spur with an enclosed rail car shed. Bay door openings are generally protected by overhangs and with overhead exterior lighting for 24-hour loading and unloading.


The most efficient configuration for small bay warehouses is a front-loading configuration, where the loading door is adjacent to the unit entry door. However, the market usually prefers rear-loading designs that better accommodate front office and show room layouts. The latter design generally markets better and achieves higher prices.

 

LOADING FACILITIES NOTES

Loading facilities may be either dock height or at grade level. Docks typically have mechanically operated levelling to provide for ease of forklift access from transport trucks into the warehouse and vice-versa. Loading bay doors may open manually, electrically, or automatically, occasionally with safety features or automatic dock height levelling devices to facilitate loading and unloading trucks.


Loading bays to a plant or warehouse should normally be under cover. For warehouses, often the roof is carried out 8 feet to 10 feet to form a canopy. Under this canopy, a loading dock is built to the normal height of the tailgate of a truck or to deck height if the loading is to a flat or box car. Some properties may have a railway spur with an enclosed rail car shed. Bay door openings are generally protected by overhangs and with overhead exterior lighting for 24-hour loading and unloading.


The most efficient configuration for small bay warehouses is a front-loading configuration, where the loading door is adjacent to the unit entry door. However, the market usually prefers rear-loading designs that better accommodate front office and show room layouts. The latter design generally markets better and achieves higher prices.

21

SMALL BAY WAREHOUSES

The most efficient configuration for small bay warehouses is a front-loading configuration, where the loading door is adjacent to the unit entry door. However, the market usually prefers rear-loading designs that better accommodate front office and show room layouts. The latter design generally markets better and achieves higher prices.

22

CRANEWAYS

Service shops and heavy industrial buildings will usually have overhead travelling craneways. These cranes vary considerably in lifting capacity. A travelling craneway can easily cost up to $100,000 to acquire and install, depending on the length of the craneway, lifting capacity, and need for building reinforcement.

 

Since craneways can generally be removed from the building without impact on the building structure, it is important for a real estate analyst to understand whether a building, offered for sale or lease, includes the craneway.

23

STEEL RACKING

A common feature found in warehouses is steel racking and steel decks (mezzanine storage). Racks and steel mezzanines must be firmly secured to the warehouse floor for safety and seismic stability under current building codes. Since racking can be removed and easily re-installed elsewhere, owners and purchasers negotiating the sale of a building will generally specify whether the racking is included in the sale or lease agreement.

24

DECOMMISSIONING

INDUSTRIAL BUILDINGS

Industrial buildings are often constructed to meet the specific requirements of a particular business enterprise and on decommissioning may contain specialized equipment or structures no longer considered suited to the highest and best (alternate) use of the property.

 

The cost to remove or remedy these features, and the added cost associated with their lack of utility, must be recognized.

25

CLEAR SPAN

Anywhere from 21 to 35 feet. Many smaller warehouses can be operated with a clear span of 15 to 20 feet, but higher ceilings might be standard in the market.

 

 

26

MEZZANINE STORAGE AREAS

Mezzanine office and storage areas are common in most warehouse buildings.

 

Some mezzanine ceiling heights in older warehouses may be less than 8 feet. Raising the office or storage area off the main floor allows the area underneath to be used for additional office, storage, or other purposes.

 

Such mezzanine areas can be constructed or added to after the original construction of the building. Mezzanine space may or may not be included in the rentable area and/or net rent, but is generally considered part of the gross building area (depends on local leasing practice).

27

Industrial Land

Early Twentieth Century

Industrial Parks


In the early twentieth century it was common for manufacturing and even heavy industry to be located in highly urbanized areas due to the need to be close to major transportation corridors and hubs including railway, rivers, and major lakes, and the workforce. Industrial areas were historically notorious for being dirty, smoky, and generally run-down. 

28

Industrial Land
Mid Twentieth Century

In the mid-twentieth century land-use planners and political leaders became increasingly sensitive to the impact of industrial use on the environment, human health, and safety. Land-use controls increasingly classified industrial types by impact, with different controls depending on level of impact.

29

Evolution of Industrial Land

A second, related approach in urban and suburban areas was to segregate industrial from commercial and residential uses through land-use planning tools such as zoning and development permit processes, creating distinct industrial precincts or neighbourhoods.

 

The planning concept was to alleviate the negative impact of industrial uses in the urban core by shifting some industry to the suburbs. This segregation of industrial uses from other commercial and residential uses coined the now-popular term industrial park. 

30

Newly created Industrial Parks

These new developments were close to major transportation routes but away from residential neighbourhoods.

The idea was to attract industry to these planned industrial communities offering more consistency of use, design, and appropriate infrastructure (wider roads, sufficient hydro capacity, etc.).