Location selection represents perhaps the most consequential decision in warehouse leasing, impacting operational efficiency, transportation costs, labor accessibility, and overall business performance. Strategic warehouse positioning creates competitive advantages that extend far beyond real estate considerations.
The Strategic Value of Warehouse Location
According to the Prologis Logistics Rent Index, prime warehouse locations command significant premium rental rates—yet often deliver superior total cost outcomes through transportation savings, labor advantages, and operational efficiencies. The location calculus extends well beyond base rental rates.
Key location factors influencing warehouse performance include:
- Transportation infrastructure accessibility (highways, rail, ports)
- Proximity to customer/supplier concentrations
- Labor market availability and wage considerations
- Municipal regulations and business climate
- Regional carrier service capabilities
The most successful warehouse location decisions balance transportation optimization, labor accessibility, and total occupancy costs—creating sustainable operational advantages.
Understanding “Last Mile” Considerations
E-commerce growth has dramatically increased the importance of “last mile” delivery operations. The Colliers International Research Group reports rising demand for urban-proximate warehouse locations that facilitate rapid order fulfillment and same-day delivery capabilities.
Distribution-focused businesses should evaluate:
- Customer density within delivery radius
- Traffic patterns affecting delivery efficiency
- Carrier pickup schedules and cutoff times
- Urban access restrictions and regulations
Labor Market Assessment
Warehouse operations require reliable workforce access across various skill levels. The Society for Human Resource Management emphasizes evaluating labor market factors including:
- Workforce density within commutable distance
- Public transportation accessibility
- Regional unemployment rates and wage expectations
- Competitive industrial concentration
Leasing Managers provides comprehensive location analysis services that identify optimal warehouse positioning based on client-specific operational requirements. Our commercial leasing professionals combine GIS-based spatial analysis with practical market knowledge to evaluate how each potential location impacts:
- Inbound transportation costs
- Outbound distribution efficiency
- Labor recruitment and retention
- Operational flexibility and growth potential
Through this multifaceted approach, we help clients select warehouse locations that balance immediate functional requirements with long-term strategic positioning, ensuring real estate decisions support broader business objectives beyond simply securing appropriate physical space.
