Renting Warehouse Space – How to Rent Warehouse and Industrial Space: A Complete Guide

Why Consider Renting a Warehouse?

As you start your business or expand your operation, you might find yourself in need of a much larger space to manufacture or store products and inventory. In this case, you may find yourself in need of industrial or warehouse space.

Warehouses, manufacturing buildings, and multi-use spaces are all considered to be industrial properties. These spaces may be used for product or goods production, storage, fulfillment, or distribution.

This guide outlines everything you need to know about finding, evaluating, and leasing warehouse or industrial space — including what to look for, how to assess your needs, and the basics of commercial leases.

To explore broader planning topics, see How to Start a Business and How to Grow a Business.

Define Your Warehouse Requirements

• Determine what activities will take place in the space (storage, production, shipping)
• Calculate the current and future space needs in square feet
• Identify must-have features like dock doors, forklift access, cold storage, or racking systems
• Prioritize proximity to shipping carriers, highways, ports, or your customers

Types of Industrial Spaces:

• Warehouse space – Primarily used for storage and distribution
• Manufacturing space – Where products are created or assembled, may require zoning or infrastructure such as reinforced floors or power supply
• Flex space – A combination of both warehouse and manufacturing space

A distribution center, a subtype of warehouse, focuses solely on shipping products and not the building or assembly process.

Types of Warehouse Lease Structures Compared

Lease Type	Who Pays for What?	Best For
Gross Lease	Landlord pays most or all expenses	Tenants wanting predictability
Net Lease	Tenant pays taxes, insurance, etc.	Tenants wanting lower base rent
Triple Net Lease	Tenant pays almost all property costs	Experienced tenants with stable cash flow
Modified Gross	Shared responsibility (negotiable)	Mid-sized businesses seeking flexibility

To learn more about commercial leases, check out this Forbes breakdown and this Business News Daily guide.

Hidden Costs of Leasing a Warehouse

• HVAC installation and maintenance
• Equipment rental (forklifts, pallet jacks)
• Cleaning and janitorial services
• Snow removal or landscaping (in some regions)
• IT and communications setup (WiFi, ethernet)
• Security upgrades or surveillance systems

Always ask for a complete breakdown of CAM fees and utility estimates before signing.

Short-Term and Shared Warehouse Options

For startups or seasonal businesses, traditional leases might be too long or rigid. Consider:

• Co-warehousing: Rent only the amount of space you need. Exa
• On-demand warehouse space: Monthly or flexible term rentals
• 3PL partnerships: Outsource fulfillment to third-party logistics providers who offer space and services

Add-On: Warehouse Readiness Checklist Before Leasing

Task	Completed
Zoning check for your business use	[ ]
Budget calculated (base + CAM + extras)	[ ]
Utility and HVAC capacity evaluated	[ ]
Insurance requirements reviewed	[ ]
Internet and phone installation confirmed	[ ]
Accessibility for trucks and staff assessed	[ ]
Lease reviewed by legal counsel	[ ]
Landlord reputation and reviews checked	[ ]

Evaluating Warehouse Safety and Compliance

Before signing any lease, evaluate:

• Fire suppression systems (sprinklers, extinguishers, alarms)
• Emergency exits and signage
• Compliance with OSHA standards
• ADA compliance for staff and visitors
• Existing or required permits for your operations

Technology Considerations for Modern Warehousing

Consider whether the space supports:

• Security systems and smart locks
• Warehouse Management Systems (WMS)
• IoT sensors for inventory and temperature
• High-speed internet for operations and cloud-based systems

Sustainability and Efficiency Features

If energy efficiency or environmental impact is a priority:

• Ask if the building is LEED certified
• Inquire about solar panels, motion-sensor lighting, energy-efficient HVAC
• Look for facilities with recycling programs or low-emission policies

Preparing for the Lease Negotiation Process

Before negotiation:

• Get a market rent comparison for similar properties
• Outline your deal-breakers and must-haves
• Prepare to negotiate lease term length, rent escalations, and improvement allowances
• Bring in a commercial real estate attorney to review legal language

How to Budget for a Warehouse Lease

Budgeting goes beyond just monthly rent. Include:

• Base rent per square foot
• CAM and utility costs
• Tenant improvements (buildout)
• Property taxes and insurance
• Moving expenses and initial setup

Use this quick formula to estimate: Total Monthly Cost = Base Rent + CAM Fees + Utilities + Services

Renting Warehouse Space with Confidence

Leasing industrial or warehouse space is a major milestone for your business—one that can fuel growth, streamline operations, and improve logistics when done right. By clearly defining your space needs, exploring modern leasing options, evaluating costs thoroughly, and securing the right terms, you can confidently sign a lease that supports your business goals now and into the future.

Whether you’re launching a startup with limited storage needs or expanding into a full-scale distribution center, take time to research, ask the right questions, and seek expert advice. The perfect space is out there—one that fits your workflow, supports your team, and stays within budget.

And remember: You don’t have to navigate it alone. Commercial real estate professionals, attorneys, and free business advisors can be valuable allies in your search.

FAQs

What are CAM fees in a warehouse lease?

Common Area Maintenance fees cover shared services such as landscaping, security, or cleaning. These are usually billed monthly in addition to base rent.

How much does warehouse space cost in major cities?

In Newark, NJ, expect $2.00–$3.50/sq ft/month. In less dense areas, $0.85–$1.50/sq ft/month is typical.

What is co-warehousing?

A flexible, shared warehouse model that allows small businesses to rent only the space they need, often bundled with services like logistics or staffing.

What’s the difference between a warehouse and a fulfillment center?

Warehouses store goods long-term. Fulfillment centers are optimized for fast order picking, packing, and shipping.

Can I customize or modify warehouse space?

Yes, but tenant improvements must be negotiated in the lease. Ensure structural changes comply with building codes.

Are there warehouse options for startups?

Yes. Look into co-warehousing, month-to-month rentals, or shared fulfillment spaces to avoid long-term contracts.

What is the typical lease length for industrial space?

3–5 years is standard, though some flexible providers offer monthly or yearly options.

Do I need insurance to lease a warehouse?

Yes. General liability, property, and workers’ comp insurance are often required by landlords.

Is there such a thing as a green or sustainable warehouse?

Yes. Look for LEED-certified or energy-efficient spaces. Features may include solar panels, skylights, or high-efficiency HVAC.

Can I sublease extra space I’m not using?

Possibly. Subleasing is often allowed with landlord approval. Make sure it’s specified in your lease terms.