Investor demand for industrial outdoor storage (IOS) has been buoyed by strong recent operating results, favorable long-term supply/demand dynamics and a de minimis capex burden, causing it to grow in popularity among institutions in recent years, according to a recent report from Green Street titled Industrial Insights — Industrial Outdoor Storage: A Beautiful Ugly Duckling.
IOS is a land site zoned for an industrial use where the tenant can store something outside, most commonly vehicles, construction equipment, building materials or containers. Most IOS sites have a small building that is generally used as an office and to store tools or parts required for the tenants’ operations. Typical IOS sites range from two to 10 acres of land with a small building of approximately 10,000 square feet in the front center of the parcel. The building-to-land ratio is generally less than 20 percent. IOS also includes truck terminals, which are specialized, low-coverage indus