Small vs Large Industrial Units: Which Is Better for Investment?

Size plays a significant role in industrial property investment. Whether you are considering a small 1,000 sq ft unit or a 10,000 sq ft warehouse, each size category presents distinct advantages and challenges. Here’s what investors should know before choosing.

Understanding the Market Demand

• Small Units (below 2,500 sq ft) are popular with SMEs, start-ups, and e-commerce businesses. They are easier to rent out and resell.

• Large Units (5,000 sq ft and above) attract multinational tenants, manufacturers, and distribution centres that need substantial operational space.

Pros of Small Industrial Units

• Lower capital outlay

• Higher rental per square foot

• Wider tenant pool

• Easier resale in the secondary market

Cons of Small Units

• Higher relative maintenance costs

• May not suit long-term tenant retention

Pros of Large Industrial Units

• Economies of scale in management and renovation

• Attract longer-term corporate tenants

• Better suited for anchor tenants

Cons of Large Units

• Higher acquisition cost

• Longer vacancy periods

• Limited liquidity

What Should Investors Consider?

• Target tenant profile (SMEs vs. corporations)

• Investment horizon (short-term flipping vs. long-term leasing)

• Supply of unit sizes in target location

Conclusion If you're looking for flexibility and lower entry costs, small units may be ideal. For stable, long-term returns with fewer tenant changes, large units could be the better choice. It all comes down to your risk appetite, financial position, and market strategy.