May 18, 2018

Controlling Warehouse Construction Costs

Any number of factors can drive a company to expand their warehouse and or manufacturing space: acquisition of a new company, new contracts coming online, adding a new product line or business, consuming warehouse space for adding manufacturing capability and numerous other possibilities.

The key to making smart decisions about growing your space with the least pain and smartest investment is to start planning early and partnering with an expert to help assess the needs and the current situation so you move forward intelligently.

Should you add on to your existing facility? Lease or buy a nearby space? Build a new building? Renovate an existing facility? What impact will these options have on your business operations? Are there other concerns or needs that make a move more sensible than expanding current facilities? What are the design factors required for your business that will drive the cost of the new space?

Early Detection

As in medicine, catching the issue early, talking to experts, and starting to plan properly always leads to the best outcomes. Identifying the need for the additional room may be easy as space constraints become evident, but working through the available solutions, budgeting properly, and setting the specific requirements for the additional room are potential traps.  Working with a construction professional when setting realistic expectations for all aspects of the available options will prove to be invaluable, including flexible ownership options for your future space needs.

Creative Planning

In many ways, the design factors that most significantly drive the cost of a facility are often the most overlooked. Issues like proper clear height/column spacing, footings required for specialty equipment, high rack space requiring higher floor strength, bathrooms/office/lab space requirements and truck docks (number and location) make the design more complex — driving up the cost. Not properly identifying these needs early on can lead to a mismatch between expectations, budgets, and needs.

Working with the right professional, your business should be analyzed in order to create workable plans with budgets for “good/better/best” options. This allows management to focus only on plans that will definitely meet the future needs while allowing the selection of the best ways to invest to ensure success with the new space.

3 Steps to Success

For each client where additional long-term warehouse/manufacturing space is required, the following steps should be part of the analysis:

  • Assess the current building for renovation or expansion and develop a plan if there is potential.
  • Look at existing market and facilities that fit the requirements or can be made to do so. If one is found, determine the renovations required, if any.
  • Look at new building options and evaluate state/local financial incentives for the project.

Preparing an initial budget on all feasible options provides the owner with the required information to make sound management decisions about satisfying their future space needs for their long-term business operations.  This approach also eliminates unnecessary design costs, pursuing a plan that ultimately does not meet your budget or space needs.

Miller-Valentine always looks for the best solution for customers space needs. We create a collaborative partnership between the owner, design team and contractor with an open book pricing method that allows the owner to minimize their time involved in the project and to obtain the best design solutions and pricing that the market has to offer.

Examples of projects highlighting the different types of solutions provided for our clients include:

Victory Wholesale – 266,000 SF New Warehouse Adjacent to Existing Facility in Springboro, Ohio

Heidelberg Distributing Company – 779,000 SF Renovation of an Existing Facility in Moraine, Ohio

Chas Seligman Distributing Company  – 125,000 SF Expansion of existing facility in Walton, Kentucky

Staco Energy Products – 100,000 SF New Manufacturing Facility in Miamisburg, Ohio

Contact Denny Whitehead at 937.293.0900 for additional information on how Miller-Valentine can provide solutions for your Industrial/Manufacturing/Warehouse space needs.

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