If you’re struggling to find available warehouse space for your products, you’re not alone. Space availability remains tight as both B2C and B2B companies compete for industrial space across the country. This demand is being driven by factors such as the growth of eCommerce, ongoing supply chain challenges, and the need for greater inventory buffers in response to market disruptions. In this article, we’ll explore the current warehousing landscape and how partnering with a 3PL can help you secure the space you need for your products.
Available warehouse space at a glance
In 2024, warehouse vacancy rates in the U.S. remain near historic lows, hovering around 3.8%, according to CBRE, a major commercial real estate firm. This rate is even lower in key markets, such as Southern California, where vacancy rates are often below 2%. Industrial real estate is seeing unprecedented demand as businesses seek to both expand their storage capacity and move goods closer to consumers.
The rise of omnichannel retail and the need for just-in-case inventory strategies have led to a sustained surge in demand. Prologis, one of the largest global logistics real estate firms, has reported that the ongoing demand for warehouse space continues to outstrip supply, leading to record-low availability. Additionally, construction of new warehouse space has been slowed by rising construction costs and labor shortages, further tightening supply.
Key port areas, such as Savannah, GA, and Houston, TX, have seen demand for warehousing increase dramatically, driven by the shift of imports away from the heavily congested West Coast ports. In Savannah alone, over 12 million square feet of new warehouse space was absorbed in 2023, yet vacancy rates remain low due to ongoing high demand.
However, the East and Gulf Coasts are currently bracing for a dockworkers’ strike which could significantly impact supply chains nationwide.
Why You Should Consider Partnering with a 3PL
If you’re looking to buy or lease warehouse space in 2024, the market is more competitive than ever. Instead of trying to navigate the complexities of this high-demand environment on your own, partnering with a third-party logistics (3PL) provider can offer significant advantages. 3PLs often have access to a variety of warehousing options, including both shared and dedicated space, that are flexible enough to meet your evolving needs.
Shared Warehousing
In a shared warehousing model, the 3PL splits the space and resources among several customers. This arrangement allows you to use only the amount of space and services that your business requires at any given time, making it a cost-effective solution. This flexibility is key in times of market volatility, as it allows your warehousing needs to scale up or down based on demand without long-term commitments.
Dedicated Warehousing
For businesses that require a more consistent and controlled warehousing setup, dedicated (or contract) warehousing is a better fit. In this model, a 3PL provides you with exclusive use of a warehouse or a significant portion of it. This option offers more predictability in terms of cost and availability, which can be particularly beneficial for businesses with steady inventory turnover.
In either scenario, a 3PL can offer value-added warehousing services such as inventory management, pick and pack services, transportation, and distribution, allowing you to focus on core business activities while your logistics partner ensures that your supply chain runs smoothly.
Why It Makes Sense to Partner with a 3PL Now
The challenges of finding available warehouse space in 2024 make working with a 3PL more important than ever. As eCommerce continues to grow and companies look to shorten delivery times, demand for strategically located warehouses near major population centers will only increase. The flexibility and scalability that 3PLs offer, combined with their logistics expertise, provide a compelling solution for businesses of all sizes.
Moreover, with construction delays and costs rising, waiting for new facilities to come online may not be a viable option in the short term. By partnering with a 3PL, you can leverage their existing infrastructure and avoid the long lead times associated with building or leasing your own warehouse.
Turn to Kanban Logistics for Available Warehouse Space on the East Coast
Kanban Logistics continues to be a reliable source of warehouse space on the East Coast, with 2 million square feet of capacity in Eastern North Carolina. We offer both shared and dedicated warehousing solutions across our modern logistics campus. And, our strategic location near the Port of Virginia and major East Coast transportation routes ensures that your goods are well-positioned for timely distribution.
Additionally, we have a unique build-to-suit opportunity with a pad-ready site adjacent to our existing 175,000-square-foot distribution center in Rocky Mount, NC. Whether you need a combined factory/distribution center or a dedicated logistics operation, Kanban can tailor a solution to meet your needs.
Contact Kanban Logistics today to learn more about how we can help you secure the warehouse space and logistics services your business requires in this highly competitive market.
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