How do the motivations of investors and owner-users differ in industrial real estate?
Investors are inspired by current yield (ROI) and yield throughout an anticipated holding period. They also tend to be more interested in resale value. They seek buildings that would have an appeal to the broadest spectrum of potential buyers. An owner-user, on the other hand, may consider only how the property fits into its own business model and contributes to its overall return on invested capital. In addition, an owner-user will likely be more sensitive to incentives — tax credits based on job creation and capital investment, property tax abatements, seed capital programs, etc. An investor may only indirectly consider incentives. Investors like designs that support divisibility — for example, a building with optional demising walls and optional entrances. An owner-user will tend to focus on its own particular workflow processes and how the building fits into these. The owner-user will value the ability to perform unique customizations on the building. Conversely, an investor will
Investors are inspired by current yield (ROI) and yield throughout an anticipated holding period. They also tend to be more interested in resale value. They seek buildings that would have an appeal to the broadest spectrum of potential buyers. An owner-user, on the other hand, may consider only how the property fits into his own business model and contributes to its overall return on invested capital. In addition, an owner-user will likely be more sensitive to incentives tax credits based on job creation and capital investment, property tax abatements, seed capital programs, etc. An investor may only indirectly consider these types of incentives. Investors like designs that support divisibility and configuration options for example, a building with optional demising walls and optional entrances. An owner-user will tend to focus on his own particular workflow processes and how the building fits into these. The owner-user will value the ability to perform unique customizations on the bui
