Warehouses are growing up, average build sizes double from 2001
Real estate developers spent $2.6bn on warehouse construction in the US in September alone, more than three times the amount spent in the same period in 2012. The average size of a warehouse built in 2017 was 188,000 sq ft, more than twice the size in 2001, and ceiling heights are 21% higher, CBRE data shows. The cause for change is likely due to retailers and logistics companies looking to store products sold online, as e-commerce stock requires a larger footprint than brick-and-mortar counterparts' stock.
NEW YORK—Those boxes piling up on your doorstep over the holidays don’t ship from Santa’s workshop. As Americans spend more money shopping online, real estate developers are sinking record amounts of money into new warehouse space, building bigger, taller structures to meet the needs of e-commerce — and the robots that help it along.

Builders spent $2.6 billion (U.S.) on U.S. warehouse construction in September, more than triple the figure in September 2012, according to the census. The size of the average warehouse completed this year was 188,000 square feet, according to a report published this week by CBRE Group Inc., more than double the size in 2001. Developers are also raising their roofs, with ceiling heights up 21 per cent over that period.

Warehouses are getting bigger for the same reason retailers and logistics firms are building more of them.

“It’s the notion of the endless aisle,” said Joe Dunlap, a managing director at CBRE, where he leads the supply chain advisory practice. A retailer that stocks 30,000 items in its stores might offer 10 times as many items for sale online. More stock requires larger footprints. Higher ceilings accommodate mezzanine levels, letting operators cram more shelves into a building.

Today’s industrial buildings require thicker concrete floors to support heavy machinery used to automate the warehouse process, Dunlap said.

While builders are pouring money into next-generation warehouses, venture capital firms are stoking competition in warehouse automation. Since Amazon.com Inc. acquired bot-maker Kiva Systems for $775 million in 2012, a new batch of robot makers has burst on the scene, including Geek+, which has raised $22 million. 6 River Systems Inc., a robotics company founded by former Kiva employees, scored a $15-million round, while RightHand, which makes a robo-arm, added $8 million to its war chest.

Meanwhile, warehouses are likely to keep getting bigger and more expensive.

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